Citi: Is This Gold's Breakout Week?

Tyler Durden's picture

Precious metals (gold in particular) continue to push higher and along with copper (to the downside) hold 'center-stage' among world commodity markets. As Citi's FX Technicals group notes gold has traded above very strong resistance on the $1,350 to $1,362 range suggestng a test up to $1,434 and the next level at the 200-week moving average at $1,493. Gold is also getting close to the "golden cross" where the 50DMA will cross above the 200DMA. Such a move, if seen, would strongly suggest that the corrective low is in (at $1,182) and that a re-test of the all-time highs at $1,921 and beyond is highly likely.

Via Citi's FX Technicals group,

Gold weekly chart: Is this the breakout week?

Gold has traded above very good resistance in the $1,350 to $1,362 range
– $1,350: 55 week moving average
– $1,353: Top of channel from the 2012 peak
– $1,362: Peak of bounce seen in October 2013.

A weekly close above this range would open up the way for a test of the pivotal double bottom neckline at $1,434. A weekly close above this latter level would complete the double bottom and suggest extended gains towards $1,680-1,685. Such a move would take us back above both the 200 week moving average at $1,493 and the horizontal resistance (previously support) from 2011-2012 at $1,523-1,527.

Such a move, if seen, would strongly suggest that the corrective low is in (At $1,182) and that a re-test of the all-time highs at $1,921 and beyond is highly likely.

Silver is so far lagging the Gold move

Surprisingly Silver has, to date, been lagging Gold in this last move higher. Good resistance stands overhead and needs to be broken to signal the next leg higher:
– $21.94: Downward sloping trend line.
– $22.16: 55 week moving average.

A weekly close above this range would open up the way for a test of the double bottom neckline at $25.10.

A weekly close above that latter level would open up the way for gains towards $31+.

Interim resistance is met at:
– $26.08-26.40: Major horizontal supports (Now resistance) in 2011/2012 that gave way in April 2013.
– $28.27: 200 week moving average



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LawsofPhysics's picture

Paper or physical?

Pladizow's picture

Gold is a treasure, and he who possesses it does all he wishes to in this world, and succeeds in helping souls into paradise.” – Christopher Columbus

flacon's picture

A lot will depend on the vote on Sunday, as well as the days following the vote. Does Putin only have one ball, or does he have balls of GOLD? Only time will tell... but my bets are squarely on his GOLDEN BALLS. (not to sound gay or anything)

fonzannoon's picture

I hope for your sake his balls are not tired.

Gief Gold Plox's picture

Let me get this strait. A bank wrote an article about where the price of gold (which is 99.999% manipulated and 0.001% "fixed") is heading based on the brilliant work of their team of technical analysis experts.

Have they never heard the term HFT? Do they expect to be taken seriously? On this site? Lol.

DirkDiggler11's picture

No new highs in Gold in the short term. The Fed just received some fresh Ukrainian Gold to lever at 100 to 1 to help keep the price of suppressed for another couple of months.

Sorry Germany, you gold order from the Fed is still on back-order, may take another decade or two before they can ship your gold, it has to come all the way from China you know !!!

JRev's picture

"Fuck the brown people, I have guns." -Hernan Cortes

DoChenRollingBearing's picture

Gold (physical) at less than $1500 is such a bargain.  Why, it is so cheap, oh never mind, you´ve all heard it before...

If you don´t have some, and if you have children, then you really need to think about getting some gold very soon.


If you are patient, gold will still be cheap at $2000.  IMO.  YMMV.

ParkAveFlasher's picture

This latest move has me feeling so nostalgic, I went and hit KWN just to again read the most important interview I will EVER read.

DoChenRollingBearing's picture

LOL, by next Tuesday, at the latest, KWN will have the most important interview you will EVER have to read...

gadflew's picture

"And what an interview he gave..."

I wonder if "interview" isnt code for something else


In addition to its monetary role, did you know gold is extremely delicious when shaven onto your Kobe burger?

DirkDiggler11's picture

KWM also reported that John Embry and the mysterious "London Trader" were both found in a bathroom stall together while looking for the also mysterious GLD underground vault.

logicalman's picture

Comparing gold to dollars tells you more about the dollar than Au, IMHO.

lasvegaspersona's picture


I'm sure you know but:

paper is what today's gold market is. 99% of all trades are paper.

Physical however is all that will count at the final buzzer.

DoChenRollingBearing's picture

I finally made it into the 1% of something decent anyway.

RamonLlull's picture

I just see enormous downward sloping triangles in both gold and silver .....

e_goldstein's picture

Gold ('cause how else are you going to be able to afford a $1000 loaf of bread), bitchez.

Greenskeeper_Carl's picture

Ya that's the truth. That's why I'm not really looking forward to seeing 100$ up days. It may feel good for a minute to have been right all along, and hear all the "how could this happen" as people watch their paper wealth evaporate, but the world is not likely to be a pleasant place for a while, gold holder or not

rabbitusvomitus's picture

And a war in Europe would send em both to the effing stratosphere.  Technicals shmecnicals! It's fear dat be driving miss daisy! 

SgtShaftoe's picture

You don't need a war, just the truth being publicly disclosed would do it.

rehypothecator's picture

Public disclosure of the truth amounts to an act of war.  

Gringo Viejo's picture

If these effeminate men and masculine women in DC don't back off, price won't matter. They're going to get all of us killed. Hard to believe how perverse it's all become.

SgtShaftoe's picture

That may very well be their plan. Hope for the best and prepare for the worst.

Gringo Viejo's picture

You too brother. God be with you and yours.

SgtShaftoe's picture

You as well sir. I'm not usually a praying man, but I've been doing just that lately.

DoChenRollingBearing's picture

Prayers to both of you, and well, to everyone else in the world as well.  Looks like we´re going to need them.

Tall Tom's picture

Yeah? Prayer is not the last resort. Prayer is the FIRST resort.


But I do not forsee any help from Heaven above. Jesus will allow the Physical Consequences of our inaction, our sins. There is no hope on Earth other than Jesus. He forgave the thief on the cross but allowed him to suffer and die for his sin.


Our situation is not problematic but it is a predicament. Problems may, or may not, have solutions. Predicaments have outcomes.


If you are in a Passinger Jet at 35,000 feet, and if it disintegrates in mid air, and, if you survive that event, then no matter how much you pray you are going to strike the ground, or, ocean, and you will in all liklihood die. That is the outcome as you would be in a bad predicament with the outcome of a fatal impact. It is not a problem with any possible solutions but it is a predicament.


Then, sometimes, miracles happen. But that is a rarity. I will not bet on that. If it happens then I will be thankful.


But I will not be angered of disappointed if a miracle does not occur and, then, following the lack of a miraculous manifestation, claim that God did not exist. But too many will do just that and will fall away.

DoChenRollingBearing's picture

Emmet Fox in 1938 wrote that anything can happen if you are spiritually very strong and your prayers are at that level as well.  It is very rare, but there are those who have immense power to do good with simple but effective prayer.

SgtShaftoe's picture

The gold "price" is like the engine temperature needle. The Bernank and Yellen, et al have been diddling it for decades. At some point the engine just shits the bed, and it's over.

It's been spewing black smoke since 2008, could be any time now.

Tall Tom's picture

I agree. The Engine can be overheated and melting, while the Engine Temperature guage can read cool or cold as there is no coolant in the Engine Jacket.


Likewise the price of Gold can remain low in an overheated economy that is in the process of melting down because there is NO GOLD in the vaults of America. (The price is as the temperature as Gold is as to the coolant.)


How many cars have you cooked? I cooked one learning that lesson the hard way.

22winmag's picture

Hope not, I'm scrapping and scraping for another ounce or two before nay major breakout.

scubapro's picture



when patterns fail they fail fast.    given gold and equities have been moving inversely of each other, this would also mean (if the relationthip ocntinued) that equities cliff dive at the same time gold breaks out.  and treasuries will probably be bid as well.  


since all this is so obvious, some different will occur.  path of highest frustration for both sides would be rally in equities just to get to near new highs, while gold gives up a thrid to half its run since dec, THEN the big moves.



enloe creek's picture

yeah cause things always go straight up  and late calls after the price has moved 15% are always correct.  useless post. 

gatorengineer's picture

you mean like faceplant, apple, etc......

Dont get me wrong if they hold the taper next week, gold will likely dip, and it would be a good time stack more.  If they pause the taper look for $1450 next week or more....  stocks smashed and bonds bid.....  oh thats already been said.

Oldballplayer's picture

And then the whole thing falls apart....and the Dow is back to 6000, the SP is 600, and gold is $500.

Things are going deflationary.

seek's picture

If that actually happens, then we'll also see bail-ins sucking up 50% of anyone's savings, then shortly thereafter monetary velocity skyrockets as trust in the USD fails, and the Dow blows past 100K and gold ceases having a price in USD.

DoChenRollingBearing's picture

Being diversified, being aware and being nimble will help.  Gold, physical FIAT$, even some Bitcoin (ah, still no takers here in Peru during my visit, "¿Que cosa es "Bitcoin", Sr?").  

And all the other stuff (like guns, food, etc.) too, in case it all blows up.

Greenskeeper_Carl's picture

Don't forget the bank runs, resulting in 'bank holidays', and long lines at every ATM as people line up to attempt to retrieve their money back from the banks at the 100/day withdrawal limit.

heavy.metal's picture

It's so stupid. People line up in the bank to get paper, while the real, physical wealth is elsewhere!

Be one step ahead. While they do that, go to the supermarket and do some shopping.

When they go sack the supermarket, be cozzy at home already.


lasvegaspersona's picture


you could hold your hand in a flame longer than the world would tolerate deflation. At the first wiff you will see CBs cranking out 'liquidity' to 'temporarily' help with the problem.

MeelionDollerBogus's picture

1st: that can't happen in that combination. If DOW drops that low gold must go up, of gold drops that low DOW must go up. They can't go down like that together. They're forcibly pushing in opposite directions with little slippage for small moves from the median zone we were in 2 years ago.

2nd: that's not even what deflation is. Deflation is not a change in prices.

Deflation requires a real loss of actual capital, not measured in dollars but the actual supply of the credit+money in existence, not merely a down-valuing of price. For every singular price that drops you simply see prices rise elsewhere with no reduction in credit+basemoney.

jmcadg's picture

If Citi see a rally, doesn't that suggest a smack down is coming?

jmcadg's picture

If Citi see a rally, doesn't that suggest a smack down is coming?

Greenskeeper_Carl's picture

That's kinda what I was thinking. Sell GDXJ and buy DUST?

Yen Cross's picture

    Quick everyone get your out of the money equity and F/X sell orders in before the weekend fireworks show starts.

Miffed Microbiologist's picture

That's one option. I myself have been backing up the truck with gusto the last year. ;-)


Yen Cross's picture

   Keep up the good work Miffed. :-)