The impulsive nature of the January/February rally suggests that gold is embarking on a major new up leg, with a break of 1340 the signal that the next impulsive rise is beginning.
The rally in gold has been characterised by a weak dollar and equities, coupled with a surging oil price. This combination is exactly what gold requires to move higher and the bulls have finally stepped up to the plate and taken their opportunity, with the bears now in retreat after having their own way for the last year or so.
Support can be found at 1320, 1312-1315, 1307, 1295-1300, 1280, 1275, 1250-1255, 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, though this is looking increasingly unlikely.
Resistance can be found at 1330-1332, 1340, 1350, 1360, 1377-1380, 1395-1400, 1420 and 1435. The breakout above 1300 suggests an end to the intermediate term down trend and that a significant rally is now developing.
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