Gold in US dollar terms is trading up to $1280/oz this morning as our Tweeter in Chief talks tough about having ordered a refurbishment of the US nuke arsenal. Regardless of why one thinks gold is rallying, the fact is that gold is making a key test of resistance that could potentially lead to a much larger upside move:
Gold (Daily)
The $1280 level offers minor resistance, however, should gold continue higher and test up into the $1297-$1300 area a much bigger breakout could be at hand; it would be the third test of this resistance area since April and could generate a breakout from the 2017 trading range, which has essentially been contained between the $1200 and $1300 round number price levels.
There is one additional notable bullish aspect to the daily chart of gold; the last two major pullbacks in gold (April/May, June/July) saw the RSI/14 (at top) nearly reach the 30 'oversold' level, however, the most recent dip has found support above the RSI median line (50 level). This is a bullish phenomenon because it signifies buying strength and means that dip buyers don't have much opportunity to buy on the dip before the next leg higher begins.
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