Gold Bumping Up Against Key Resistance
Price action in and around 170-174 will be important to watch in the coming days.
After basing for three to four months, gold prices rocketed higher. The recent run began well before the Fed announced its new bond buying program (a possible tip off that QE3 was coming) and continued on after. But the past four sessions have brought consolidation… and more importantly, at a magnetic target: the backtest of the broken 3-year bull trend line.
Broken trend lines often serve as excellent live angles for support and resistance down the road. And this one is a big one, especially upon initial approach. Price action in and around 170-174 will be important to watch in the coming days. Note as well that gold is well above its 20-day moving average.
Note that gold is represented as SPDR Gold Trust (GLD) in the charts below. See also the bonus chart: gold and equities versus the dollar.
Lastly here's an add-on chart, updated from my article A Technical Look at the Financial Markets:
Editor's Note: Andrew Nyquist is an independent investor based in the Minneapolis area. This article originally appeared on his investing and economics site, See It Market.
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