Gold. Analysis of how it broke out the trendline
Hello everyone,
This is a analyisis on how gold broke out from it's downtrend. I'll do a separate idea on what are the potencial targets for gold in the future.
But for what I think it would be pretty useful to understand how it was behaving whilst trying to enter the bull market.
So firstly in from around 2015 to 2016 gold had a massive rally, but the fundamentals weren't yet ripe to sustain the rally, the economy was still "alright" although the first tremors began occur in the main indexes like the S&P 500
Then from 2017 to 2018 we've had an everything rally, with the commodities, Indexes, and even Bitcoin topping at pretty much the same time in the first months of 2018, why you might ask? Well this is the same period as the dollar index made it's 14% decline from the highs. So it's inflation! Maybe all that QE really started to kick after all those years?
Though that didn't last long as dollar started rallying again and the stock market started to show crack's in it's facade by making huge moves both ways creating the megaphone pattern that we see now.
All that uncertainty finally meant it's time for gold to brake out, and brake out it did. It didn't even stop at any resistance levels, just went straight out of the downtrend channel.
I'll check out what's in store for gold next time, so stay tuned
This is a analyisis on how gold broke out from it's downtrend. I'll do a separate idea on what are the potencial targets for gold in the future.
But for what I think it would be pretty useful to understand how it was behaving whilst trying to enter the bull market.
So firstly in from around 2015 to 2016 gold had a massive rally, but the fundamentals weren't yet ripe to sustain the rally, the economy was still "alright" although the first tremors began occur in the main indexes like the S&P 500
Then from 2017 to 2018 we've had an everything rally, with the commodities, Indexes, and even Bitcoin topping at pretty much the same time in the first months of 2018, why you might ask? Well this is the same period as the dollar index made it's 14% decline from the highs. So it's inflation! Maybe all that QE really started to kick after all those years?
Though that didn't last long as dollar started rallying again and the stock market started to show crack's in it's facade by making huge moves both ways creating the megaphone pattern that we see now.
All that uncertainty finally meant it's time for gold to brake out, and brake out it did. It didn't even stop at any resistance levels, just went straight out of the downtrend channel.
I'll check out what's in store for gold next time, so stay tuned