Cycle Trading

Gold closed at 1753 on Friday and delivered bullish follow through on Monday.

Gold clearly broke above the 12 week resistance level on Monday. We discussed on Thursday that a weekly close above the 1750 resistance level will be our buy signal. And Monday’s rally got gold off to a good start. Keep in mind that over the past 12 weeks gold has pierced the 1750 resistance level several times, but did not hold on for a weekly close above the resistance zone. This is why we are looking for a weekly close, not a daily close, above the resistance level. Because at 14 weeks, if gold closes back below the multi week resistance zone then gold would be at risk for continuing down into an intermediate cycle decline.