Gold Prices

For gold, it’s time to shine. At least, that’s what market technicians are saying, and investors are loving it. Higher gold prices have been long overdue, and with tensions rising as we head towards having a new president, prices are going to be all over the place for some time.

Gold prices have gained 9.6% to $1404.30 an ounce this year. That’s a huge jump from where it was even a month or two ago, averaging around $1200.00 to $1,300.00 an ounce. According to a market technician, their work projects the precious metal will move substantially higher from current levels. Gold should maintain its upward trend in the coming months, due to its fundamentals and technicals.

Beginning with the fundamentals, Federal Reserve policy continues to accommodate. Pressures from the president ignite concerns that the Fed might lose its independence. Tensions in the Middle East continues to rise, and Turkey is awaiting delivery of Russian S-400 missiles.

The U.S Dollar is on the verge of declining. The U.S. Dollar Index is down lower than 2% from its high, and the market technician states it’s a sell signal. The Dollar Index will accelerate lower, on a weekly close below 95.50.

In December, gold began demonstrating relative strength versus the Dollar. This was as it started to advance in the face of dollar strength, which is the opposite of what should happen.

When gold was trading at $1292, in the May 30 issue of THE INSTITUTIONAL VIEW, the market technician said that gold’s pullback from resistance was a mild and bullish down-up-down. From an initial 1330 target, their work projected a significant breakout from the 2.5-year base.

Weekly closing charts illustrate that each pullback is weaker than the prior one. This leads to the upside breakout. Looking at initial $1425-$1435 trendline resistance, the next strength is $1485. Long-term, their work projects an objective of $1600.