Gold approaches all-time highs

In the previous post on gold, we expressed our fears about the shiny metal amid a sudden spike in volatility and a slight drop in the U.S. market indices (accompanying the spike in VIX). Nevertheless, it did not take long for the volatility to falter and the fear to disappear among market participants. Quickly, the market leaped higher, and gold followed in tandem, breaking above $2,100. The overall picture improved at a fast pace, and now, gold trades merely $20 away from its all-time highs. However, as stocks and cryptocurrencies are reaching the euphoria phase, the case for a significant pullback in the two markets is growing, which could (temporarily) negatively affect gold’s performance; in our opinion, the stock market weakness is one of the biggest potential foes to gold going forward. Yet, this does not change our view of the big picture. We remain highly bullish on gold in the long term and maintain the price target of $2,300.

Illustration 1.01

Volume increases alongside the price, which is normally a positive development.

Technical analysis
Daily timeframe = Bullish
Weekly timeframe = Bullish

Please feel free to express your ideas and thoughts in the comment section.

DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not serve as a basis for taking any trade action by an individual investor or any other entity. Your own due diligence is highly advised before entering a trade.

Comment:

As a reminder, Jerome Powell's testimony is scheduled for today and tomorrow. Depending on what Powell says during the testimony, stocks, crypto, and gold might turn volatile.

Comment:

Gold reached a new all-time high of $2,162 per troy ounce.

Trade closed: target reached:

Gold reached our price target of $2,300.