Gold remains a compelling trade in the early weeks of 2019

From the consolidation base set during late 2017 to the early breakout in the longer term weekly chart, many Gold stocks have gone along for the ride.

Gold has currently found resistance just under the $1300 level and remains in a daily consolidation pattern. The pattern is considered a continuation pattern as the Primary UP trend remains in place.

The daily chart shown highlights the capitulation low made during August 2018, this price low was not breached in the following months with an eventual breakout higher during December 2018.

The current “continuation pennant” is setting up for higher prices with the resistance at $1299.00 the key level within this pattern.

The above daily chart also shows the Relative strength Indicator (14) rolling lower but todays upturn shows that positive price momentum remains.

AUD and Gold
Traders of Australian Gold stocks should also be aware of the Australian dollar Gold price, that is Gold priced in Australian dollar terms. The AUD Gold price level, recently moved to $1900 an ounce, propelling the Australian based miners higher.

The Australian dollar moving lower improves the AUD Gold price even when the US dollar Gold contract remains constant. The above Weekly chart of the AUDUSD cross shows a broad down trend over 2018, which lifts the Australian dollar Gold price and improves the profitability of the Australian listed Gold producers. Key stocks to monitor in the coming months remain RRL, EVN, SAR, OGC.

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