After a stellar run in 2024 the Spot Gold Price has been Consolidating for the last couple of months. My last piece of Technical Analysis on the gold price was when the Uptrend Broke Down and I wasn't sure if we were going to see a Consolidation or a Correction. To be fair I am still not sure because if it was going to consolidate I'd expect that process to take maybe 3 to 6 months, but here we are with a new chart structure forming that we can contemplate...
What we've seen since November is an unusual structure forming where we have 3 touches of a Resistance Line where the price is today - at around $2715, along with 3 touches of an inclining Support Line which is narrowing the gap. If this new structure holds out it could still last for another couple of months but we are going to know which way it breaks pretty soon. At the latest it would be March, but my gut says it will break sooner than that...and I am currently leaning on the bullish side.
That would be great news for the stacking crew here at SGS of course, but it's still far too early to tell. The economic data coming out of the US currently is fairly bi-polar. The narratives are swinging one way and the other regularly now. From Rate Cuts to Rate Hikes to Rate Cuts again, with Jobs and Inflation data frequently muddying the waters. A new US President is incoming within days and we've seen some interesting Animal Spirits in play since the election was resolved and yet the typical Santa Claus Rally was a total flop this last year.
In short, who knows? I personally will be watching this new structure closely to see which way it might break and I'll make an adjustment to my portfolio when I see it. I may not have time to post about it when it happens so keep an eye on those lines. It's a pretty weak structure, but I find that 3 touch points is often enough to make a line worth respecting.
DISCLAIMER - This is not financial advice
