Anna Coulling writes:
"... From a technical perspective, having broken above the sideways congestion in the $1720 to $1740 per ounce region, Friday’s price action has now created a strong platform of support for a sustained move higher. Yesterday’s price action was muted, with the market trading in a tight range to close marginally lower at $1749.60. However, with the US dollar now looking weak, the next technical level on the chart is the deep level of price congestion between the $1770 and $1800 per ounce region, and with rising bullish volumes on the daily chart, we should see a run back to test this level in due course.
"For the trend to develop further, we need to see this positive sentiment reflected on the three day chart, where the longer term trend remains firmly bearish for the time being. In addition, we have yet to see the buyers return in this timescale, with volumes remaining negative or neutral. For a break beyond the $1800 per ounce price level, we need to see a transition in the three day trend, at least to congestion in white, which will then signal a move from bearish to bullish, and provided this is coupled with buying volumes, then this will provide the necessary momentum, and no doubt put a smile back on the face of gold bugs everywhere! ..." click through for the full piece and chart.