Gold Trading: Something Interesting Is Happening!

| January 14, 2015 | 0 Comments

goldGold Trading: Something’s UP!

No doubt about it, gold suffered from a case of the yips last year.

In case you’re unaware, the yips are involuntary wrist spasms affecting golfers when they make a put.

They have the ball lined up perfectly with the cup, yet the shot veers in an unintended direction.

I don’t know about you, but when I play golf, I have the yips on every ball I hit!

Gold suffered a similar fate last year. Just when the yellow metal seemed destined for higher prices, it veered in an unintended direction- down.   After plenty of missed puts, gold ended 2014 very close to where it started the year, $1,200 an ounce.

But as 2015 gets into high gear, the metal is acting differently…

No Fundamental Reason To Buy… But

Since the start of the year, gold has rallied to $1,240- a healthy 3% upturn. While I admit the early year rally isn’t that remarkable in the grand scheme of things, there’s something very interesting happening.

The metal is rallying despite the fact there’s really no short-term fundamental reason to buy it. 

After all, US inflation levels are still benign. What’s more, the US Dollar is still in a strong uptrend. As you may remember, the currency kicked off a remarkable rally in July 2013. Thanks to the greenback’s strength, the US Dollar index is trading at 9-year highs.

But here’s what’s really catching my eye…

Gold’s recent upturn has it breaking above a very important trend line.

Take a look…

As you can see, gold consolidated between $1,225 and $1,150 in the final two months of 2014. But the 2015 rally has gold surpassing a trend line (red line) that has held it in a downtrend since the middle of last year.

With this long-standing technical resistance level in the rear view mirror, there’s a growing chance gold surges to the next level of bearish opposition at $1,280.

Gold Trading Takes A Bullish Turn

No doubt about it, gold’s recent rally is raising some eyebrows. The metal is putting together a strong rally despite ongoing fundamental headwinds.

Of course, the main question is whether or not this early 2015 rally is sustainable.

Here’s my take…

While it’s tempting to be overtly bullish on gold, the metal still has a lot to prove. There’s still plenty of overhead technical resistance, which can send gold swiftly lower.

But here’s the deal…

The best rallies tend to happen when investors least expect them.

Until Next Time,

Justin Bennett

BIO: Justin Bennett is the head commodity research analyst at With over a decade of real world trading experience, he finds ways for you to consistently profit from movements in commodities and the companies producing them. Sign up for our free reports and commodity newsletter at

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Category: Gold, Precious Metals

About the Author ()

Justin Bennett is the editor of Commodity ETF Alert, an investment advisory focused on profiting from the ebb and flow of important commodities via ETFs. The commodity veteran and options specialist is also a regular contributor to the Dynamic Wealth Report. Every week, Justin shares his thoughts with our readers on a variety of commodity-related topics. Justin is also a frequent contributor to Commodity Trading Research’s free daily e-letter. And he’s the editor of another highly successful and popular investment advisory, the Options Profit Pipeline.