Will Gold Manage to Break Above Its Mid-2022 Top? / Commodities / Gold & Silver 2023
Gold started this year with a quickrally, but it was mostly erased. It’s still above its mid-2022 high, but willit stay there for much longer?
IsIt All Bearish?
The above chart features goldprices in terms of weekly candlesticks. As you can see, it justapproached its August high, and it’s trying to break above those highs onceagain. The previous attempts failed, so the question is whether this attemptwill succeed.
I doubt it. Given the shape of thisweek’s candlestick, a decline from here is much more likely. After all, that’swhat prices tend to do after reversal candlesticks – they change direction, andthere’s no doubt that the most recent short-term move was to the upside.
Of course, the week is not over yet, butgiven the lack of a decent rally in today’s pre-market trading,it’s likely that the weekly reversal will become a fact shortly.
Again,this is a very powerful bearish indication.
Similarities
From a short-term point of view, we seethat the gold price moved to its 50%Fibonacci retracement level, and then moved back down below it. In other words,gold invalidated its breakout above this important resistance level, just likeI’d been expecting it to.
I copied the mid-2021 topping pattern tothe current situation. I marked the period from the first intraday high to thestart of the decline, and I marked it from the intraday high to the intradaylow of the pattern.
Those are not identical, but there isstill much similarity present.
Interestingly, both patterns werepreceded by similarly sharp rallies, which were preceded by a broad bottom,which in turn were preceded by a decline of about $2,000.
The difference is now that gold has movedto new intraday highs, while back in mid-2021, it hadn’t. Then again, nothingspecific happened on the USD/JPY exchange rate back then, as it was onlyrecently when the Bank of Japan moved to the hawkish camp.
The above-mentioned similarity as well asthe invalidation of the breakout above the 50% Fibonacci retracement together painta very bearish picture for gold’s short-term outlook.
Naturally, the above is up-to-date at themoment when it was written. When the outlook changes, I’ll provide an update.If you’d like to read it as well as other exclusive gold and silver priceanalyses, I encourage you to sign up for our freegold newsletter.
Przemyslaw Radomski, CFA
Founder, Editor-in-chief
Toolsfor Effective Gold & Silver Investments - SunshineProfits.com
Tools für EffektivesGold- und Silber-Investment - SunshineProfits.DE
* * * * *
About Sunshine Profits
SunshineProfits enables anyone to forecast market changes with a level of accuracy thatwas once only available to closed-door institutions. It provides free trialaccess to its best investment tools (including lists of best gold stocks and best silver stocks),proprietary gold & silver indicators, buy & sell signals, weekly newsletter, and more. Seeing is believing.
Disclaimer
All essays, research and information found aboverepresent analyses and opinions of Przemyslaw Radomski, CFA and SunshineProfits' associates only. As such, it may prove wrong and be a subject tochange without notice. Opinions and analyses were based on data available toauthors of respective essays at the time of writing. Although the informationprovided above is based on careful research and sources that are believed to beaccurate, Przemyslaw Radomski, CFA and his associates do not guarantee theaccuracy or thoroughness of the data or information reported. The opinionspublished above are neither an offer nor a recommendation to purchase or sell anysecurities. Mr. Radomski is not a Registered Securities Advisor. By readingPrzemyslaw Radomski's, CFA reports you fully agree that he will not be heldresponsible or liable for any decisions you make regarding any informationprovided in these reports. Investing, trading and speculation in any financialmarkets may involve high risk of loss. Przemyslaw Radomski, CFA, SunshineProfits' employees and affiliates as well as members of their families may havea short or long position in any securities, including those mentioned in any ofthe reports or essays, and may make additional purchases and/or sales of thosesecurities without notice.
Przemyslaw Radomski Archive |
© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.