Gold is coming out of its correction. The actual gold prices are shown in the top graph. Note the volatility of prices, which is typical for a market changing directions. The second graph shows the break in the US Dollar. UUP tracks the US Dollar. The third and fourth graphs show weekly gold prices and end in the bottom of the correction.The last graph shows the gold price plotted on a weekly basis. We now have two consecutive weekly rises, which is a confirmation of the end of the correction.
Three aspects of the graph are noteworthy: 1. The MACD lags the weekly gold price though it is bottoming out; 2. we are seeing the beginning of acceleration in the gold price, similar to what we saw at the end of 2009 and 3. we now expect a sustained rally in gold that will last into next year.
What about Larry's predictions of gold dropping back maybe as far as 1,100? Not going to happen. Gold is migrating to the East and is getting permanently sequestered there. Tremendous quantities of Euros will be printed to recapitalize European banks and the FED will continue injecting money into the pot. It is not in US interests to drive up the price of the Dollar, so we already see a drop in the Dollar. It is at a tipping point and if it goes below 76 a further downward drop can be expected.
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