Gold is currently at $1,674 per ounce, having advanced $75 over the past 5 days. Importantly, from a technical perspective, the gigantic wedge that gold has been tracing out since last August (for over a year now) has been breached to the upside.
We've been tracking this in our podcasts with Mish for a while. This is the most newsworthy advance for gold in…well, a year.
What we need to watch out for here is confirmation that the upside breakout can stick and that it's not a head fake designed to lure the unwary into an ill-timed purchase. As always, I'd rather miss a little bit of a run than get caught buying a 'fake-out' move.
Here's the chart seen from a weekly perspective, each bar represents one week's worth of gold's price movements, which is current as of yesterday's close (it does not include today's $20 pop ,so just mentally place that in the picture):
Note that the 50-week moving average, yesterday's closing price, AND the down slope of the giant wedge all met up yesterday at $1,656. I was watching the price behavior of gold last night and this morning very carefully to see whether that point would become a temporary ceiling or a trifling barrier that gold would hop over.
It hopped over.
Both the RSI (at top of chart, circled in blue) and the MACD (at bottom) say that gold has plenty of room to run to the upside here.
by rector 
