Gold Forecast – Gold Price Supporting a Bullish Breakout

• Gold is trading above last week’s high ($1880), and the dollar is down sharply. Closing above the intermediate trendline near $1925 would register a breakout (green arrow).
• Failing to breakout above $1925 would promote a return down to the $1750 level by year-end (red arrow). We should know which scenario is unfolding within the next 1 to 3-trading days.

The Stimulus Saga

Congress has been attempting to pass a second round of stimulus since October. Each time, the lead politicians optimistically say a deal is close (gold rallies), and each time the negotiations fall apart (gold collapses). Will this time be different? I am not sure, but the dollar is acting like a bill will pass.

Eliminating Emotions

The precious metal markets are incredibly volatile and heavily manipulated. One moment prices are surging higher, a few hours later – prices are collapsing and vice versa. It happens time and time again. That is why it’s important to have breakout levels.

It is hard to say what will happen over the next few days, but I will update members each step of the way. Also, the days following a Fed meeting are often tricky and filled with volatility, so be careful.

Note- We issued a Gap Strategy long trade in GDX to Premium Members at today’s open.

AG Thorson is a registered CMT and expert in technical analysis. He believes we are in the final stages of a global debt super-cycle. For more information, please visit here.