Gold fever continues to start European morning trade
Gold pushes to a fresh all-time high of $2,033
Upon breaking the 2011 high, gold has put up a good showing as gains consolidated just around $1,980 levels before breaking above that in a push above $2,000 yesterday.
As we progress through the new day, those gains are extending as we see gold climb to fresh all-time highs above $2,030 currently.
From a fundamental perspective, it is tough to find fault with gold but the parabolic climb over the past few weeks has really been something else.
Technical exhaustion would be as good a reason as any for gold to retrace but so far buyers are looking unrelenting. Just take a look at the near-term chart:
The slight pause around $1,980 never really saw sellers wrestle back near-term control as buyers kept a defense of the 100-hour MA (red line) throughout.
As much as I would like to keep talking about how great the prospects for higher gold prices are looking, I would be cautious about any potential violent pullbacks – especially when the trade starts to become one that “everyone is talking about”.
But in any case, any pullbacks will prove to be good dip buying opportunities in the longer-term. Especially when central banks aren’t going to move away from current policies any time soon, keeping gold’s strongest tailwind very much alive:
At this point, you have to consider the possibility that perhaps only the Fed can derail the rally in gold over the next few years.
However, so long as they keep the punch bowl full, the party looks set to continue.
Source: Technical analysis