The gold market is only one collapsed US stock market rally away from a new bull market if you follow the ninety-week moving average for the gold price as shown in the chart below. According to GoldSilverWorlds.com the critical point to watch for on this chart is $1,227 an ounce for gold.
Impressively the precious metal was just $38 shy of this mark on Thursday night. The ninety-week moving average has been a very reliable indicator in the past…
What would boost gold higher in terms of market fundamentals? We think it might well be a faltering of the recent mini-rally in US stocks which is based on bad news keeping interest rates down. This is not really good news for profits, and very vulnerable to yet more bad news from the US economy and, or the rest of the world.
Gold would then move in the opposite direction as a safe haven, and get a further boost from the greatly diminished possibility of higher interest rates any time this side of the US Presidential Election next autumn.
And once the ninety-day moving average is breached then it could be chocks away for a big take-off in the gold price. This now looks tantalizingly close.