Here Are the Key Gold Charts to Watch Right Now
The comments below are an edited and abridged synopsis of an article by Jesse Colombo
After briefly rising above $2,000 in August, gold has not been able to catch a break. Many believe that Bitcoin is the new digital gold, which explains gold’s lackluster performance over the past few months. Others believe that Bitcoin is a gigantic bubble or Ponzi scheme that will end in disaster, which will reaffirm gold’s place as the premier safe-haven asset.
Some take a more inclusive approach, and believe that Bitcoin and precious metals can co-exist in a portfolio of safe-haven assets.
The daily chart shows that gold futures have been trading in a channel pattern since August 2020. Gold is sitting above the $1,700 support level that formed last spring. If gold can push above its channel pattern in a decisive manner, it would increase the odds of further bullish action. If gold breaks below the $1,700 support, it gives a bearish signal.
The weekly chart shows gold’s channel pattern as well as an uptrend line that started in early-2019. Gold’s uptrend of the past couple years remains intact as long as it stays above this uptrend line; if it breaks below it, it will give a bearish confirmation signal.
The monthly chart shows a much-longer term uptrend line that started in the early-to-mid-2000s. Gold’s long-term uptrend remains intact as long as it stays above that uptrend line.
For now, Colombo is watching how gold acts at the lower bound of its channel pattern as well as the $1,700 support: Will it stage a rally or break below? Regardless of the short-term action, he is a long-term believer in gold and silver as hedges against the actions of global governments and central banks, which have been recklessly racking up debt and printing money like there is no tomorrow, with no end in sight.