This is a potentially very bullish development and would strongly suggest that the intermediate term bear market correction in gold is over. However, we need to see further confirmation before we can definitely say that the correction is over.
This development also suggests that we can expect to see further dollar weakness and equities may be approaching a top as well. This morning, the dollar is clinging to support at 80 and equity futures are down sharply and in danger of breaching the 20 DMA - a potentially significant development.
Support can be found at 1333, 1325-1326, 1318-1322, 1310, 1306, 1300, 1289, 1285, 1263, 1257-1260, 1250-1252, 1237-1240, 1220-1225, 1210, 1200 and 1180. A break of 1180 would have serious bearish implications for gold and suggest a decline to 1000-1050 in the short term - however the break below 1250 seems to have been invalidated, indicating that a return to 1180 is now much less likely.
Resistance can be found at 1340-1342, 1352-1354, 1392-1395, 1400, 1420 and 1435. We are now breaking through the key 65 week MA - this would suggest that the intermediate down trend is at an end and higher prices are ahead.
Today's video for subscribers looks at the recent trading in more detail and our strategy for our next trade.