Gold Bull Alert
Intermediate Term Trend Change
Gold closed above the important $850 level. This re-establishes gold's intermediate term trend as bullish. Further confirmation is needed with a weekly close above $850.00.
As long as gold stays above $850 the intermediate term trend will remain bullish. Short term anything can happen.
The direction of the dollar is of major importance for gold. If the dollar continues down - gold will continue up. Gold will fall if the dollar goes back up.
Gold's daily chart shows a powerful right-angle ascending triangle formation with a breakout above resistance marked by the horizontal line at $825.00. Price has closed above its 200 day moving average as well.
Gold may be a bit overextended short term and in need of a consolidation before advancing on the next major move, which will be an assault on $1000 and $1200 later in 2009.
The weekly chart shows gold bumping up into overhead resistance as marked by its downward sloping price channel and its 50 day moving average.
Will support at 78 hold?
Short term the gold move is becoming extended, while the correction of the dollar is approaching support. The dollar may hold initially, but not over the intermediate term. Too much debt is being created and it is pressuring the dollar down.
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