A quick look at the short-term chart on gold.
Gold has risen back above its 50 DMA today…and it has broken above its short-term trend-line (going back to the early September highs). If it can now break above $1,520 (which is its intraday highs from 3 different days this month), it should be quite positive for the yellow metal. This will be particularly true because its MACD chart is starting to show signs of it “crossing” to the upside.
Any long positions that are initiated or added with a break above $1,520…should have tight stops, but there’s no question in our minds that gold is starting to look a lot better right now. We HAD been thinking that gold need to sell-off down below $1,450 before it saw another sustained rally…but its sideways move this month has worked-off a lot of its (former) overbought condition. So we’re turning more constructive on gold on a short-term basis. (We had remained constructive on a long-term basis throughout the past two months, but we did think it would have to take a “breather” over the near-term.)……..Needless to say, if it breaks above its Aug/Sept highs, it’s going to be very bullish for gold on a short, intermediate AND long-term basis.)
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Matthew J. Maley
Managing Director
Chief Market Strategist
Miller Tabak + Co., LLC
Founder, The Maley Report
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