July 31, 2023 - (Gold Market Wire) - The Gold market disappointed the bulls on Friday, as we failed to get through the horizontal line. Given the history of resistance there, it was not entirely unexpected. For two and a half months now, we have been trying to get through $1977, without a single close above. Those who sold volatility in May and June are the only money makers here.

As we have been wont to express over the past weeks, the failure to get above the horizontal resistance is no 'death shot' to the metal. Gold continues to reside comfortably in the uptrend (as seen above.) Along with our overhead resistance and horizontal, the battle lines are pretty clearly drawn. Regardless, Gold needs to make a move to avoid another revisit to $1900. Time is not on its side.

Regarding the long-term - at this juncture, we would like to opine briefly on the fact that the war in Ukraine will have some fairly pronounced macro effects for years to come, and one of those will be higher inflation from the borrowing and forward sending the US has undertaken. This looks ready to be punctuated by a 10% increase on defense spending for next year. Given its extremely high plateau, already, this is going to put a floor under Gold for many years. It should be recalled that while the combined spending of LBJ's "Great Society" and Vietnam together, which saw ballooning costs kick off in the second half of the 1960s, it took the Gold price until the mid-1970s to really work up a lather. This Bull market may be a more protracted event than many are anticipating.

While everyone sits around waiting for the moonshot, it could actually be that we have volatility, but only in the context of a more progressive move higher. If it takes 7 years to gain another 50% on the price move, is your book prepared?