Gold looks poised to break out of the flag it has traded in the past two weeks and begin the next leg higher. There is some minor resistance dating back to September 4 that gold needs to break above, but all the other important metrics point to a daily cycle low happening on January 14. The 10 day average did turn down and today gold closed above it for the first time since January 13. We are now on the 4th day of a new daily cycle which will likely last through the end of next month.
If you had any inclinations at all to add to your positions, you should be making your plan now. Once the price moves above that resistance area, the price can get away from you very fast. This next chart goes back in time to the all time gold high ln 2011. This chart has two areas of resistance which I have labeled. The first area is where we are today. As I have stated, once gold passes through 1572, we will be off to the races. There really is no resistance until price reaches the second resistance zone at 1800.
A 200 point move at $100 per point would be worth $20,000 per contract. We are only 4 days into the second daily cycle, so there should be a lot of energy to get through the first resistance zone. If you wish to wait until we get the breakout, I understand but quickly adding to your positions will pay handsomely. Be making your plan now so it won't be an emotional decision to make.
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