Gold has solidly taken out resistance centered near $1840 – $1845 and has now moved directly to the next level of chart resistance near $1880. This is the last barrier before a retest of the former all time high near and just above $1900 is in order.
That gold is doing this even as the Dollar is moving higher is evidence that it is trading primarily on currency related issues now ( currency debasement by the respective monetary authorities).
We are back to looking at the same issues that have driven the metal higher in the first place – deliberate currency debasement efforts by the monetary authorities ( aka loose and extremely accomodative monetary policy combined with official sector buying of government bonds ); raging inflation in the far East, particularly China and South Korean; and three, enormous federal budget deficits in the West. Throw in a good dose of rotten economic data releases which will reinforce the need for accomodative monetary policies resulting in NEGATIVE REAL TERM YIELDS for savers, and you have a perfect storm for higher gold prices.
That is the situation from a fundamental perspective. From a technical chart perspective, we will watch to see how gold acts should it make a move towards $1900. I would expect an all-out effort by the perma bears at the Comex (bullion banks) to check the metal at this level and attempt to paint a technical chart pattern known as a double top. They know full well that if they are unable to absorb the plethora of bids or buy orders that will come into the market as its price rises and thus fail to hold it below $1900, gold will be at $2,000 before the month is out.
I should point out here that gold has also made a Brand new all time high WEEKLY SETTLEMENT PRICE.