Gold Market Momentum In 7 Great Charts

The price of gold closed once again higher today. Spot gold in USD was up 1.3% at $1,292.54 at 3 PM in New York (8 PM in London), while U.S. gold futures for February delivery settled up 1.4% an ounce at $1,296.20. Gold in Euros closed at €1,119, a rise of 1.8%. Gold in Euros is behaving very strong at this point. Not coincidentally, the Euro is plunging relentlessly against the US Dollar since the summer of 2014. As we have reported before, the price of gold in all major currencies is significantly higher; in some currencies, it is literally exploding.

The gold market currently looks very strong on the charts. We collected 7 great precious metals charts as featured on www.ChartAnalyst.expert, in their “metals” section.

First, the daily gold chart shows a strong price increase in the last weeks, but there is still some room to go higher. The light blue declining trendline was broken last week. The stopping power on the chart is probably going to come from the upper light red line.

 

Second, on the weekly gold price chart, we see that the long term trendline has been broken. That is good news for gold bulls, given that the breakout holds. In other words, the weekly closes in the coming weeks should consistently stay above the trendline.

 

From a technical point of view, the weekly gold chart was already signaling strength in the last months of last year. The chart below reveals a divergence between the moving average indicator MACD and the gold price, as indicated by the two dark blue support lines.

 

Not only gold, but also silver is trying to through its long term downtrend. Silver should also stay above its weekly resistance line. Several weekly closes above this line are bullish for silver, but also for the whole precious metals complex. Bulls should not become too enthusiastic yet, as there was a similar attempt to breakout back in July of 2014, but it failed. Weekly closes will be of great importance in the weeks ahead.

 

The gold to dollar ratio is confirming the strength in the precious metals market so far. The ratio is breaking out, as evidenced by the next chart. Here again, this breakout should hold in order to get a confirmation.

 

Another angle which provides in general confirmation of strength and/or weakness is the gold mining sector. The monthly chart of the gold mining index HUI relative to the S&P 500 is attempting to break out. That should not come as a surprise, given the extremely oversold levels of precious metals miners of the past two years.

 

The breakout is also confirmed elsewhere in the precious metals complex, in particular in platinum. The breakout in the platinum spot price was accompanied by bullish volume on the breakout.

 

Several charts are courtesy of Chris Kimble from Kimble Charting Solutions