Gold Market Wire
News, analysis and commentary for gold traders and investors
Gold Market Opening
Gold Breakout in Motion
January 4, 2021 - (Gold Market Wire) - In the quiet of New Year's eve, on practically zero volume, Gold got over the downtrend. Maintaining it on January 1 was certainly a watershed event in a short-term sense, but those two days can hardly be called proper trading sessions. Not so, this Asian a.m. The down trend, which has been with us since August is no more. Gold has broken out.
The discipline demands that we establish length. The over-reaction of Asia may indeed be a facet to contend with, and so some pullback is likely. But, as it stands now, length is advised. Cautious traders can wait for New York to see if the gamma traders sell on the opening, but the market has started the year on a solid footing.
Its interesting that the first legs of the move higher were taken almost in the fashion of stealth...while everyone was asleep or enjoying a holiday at home. But the minute we hit the trading arena for real, we vaulted. Of course, we abhor chasing strength and would like to see a pullback, but we also recognize that the crossing of the moving averages and the clearing of the downtrend line in such a fashion is a significant event.
Let's pay attention to the up-channel, which is defining the move higher now, and see if it helps provide an entry point.
Right now Gold is in decent shape. While the close of the year had a deceptively positive finish, one should also be reminded that, in 2020, we did not power ahead to close at all-time highs, though we did touch a new all-time high during the year. That makes for a mixed message. But with the commodity complex on fire...from copper to agriculture... Gold has a strong tail-wind, and has started the year in solid shape, by taking out some important markers.