It’s been a wild month for gold.

The shiny, yellow metal slapped bullish traders with a big decline in late September. And it slapped the bears just as hard over the past two weeks.

Today, I’m going to predict who gets slapped next…

When we looked at gold last month, we noted the metal looked set to make a big move in reaction to the September Federal Open Market Committee (FOMC) meeting.

The chart had formed a consolidating triangle pattern and all of the moving averages were coiling together. There was lots of energy building to fuel a big move.

That energy was spent on the downside as gold lost $125 an ounce in less than two weeks.

Here’s an updated look at the chart we showed you last month…

But the brutal decline in late September was matched by an equally brutal rally over the past two weeks. Gold trades today at the same price it traded last month – before all the drama.

Indeed, if you had fallen asleep on September 19 and then woke up this morning, it would seem like nothing had happened.

The question now is, “Where do we go from here?”

Gold has rallied back above all of its various moving averages. That’s bullish.

But those moving averages are still in a bearish formation – with the shorter-term 9- and 20-day EMAs below the 50-day MA. This setup typically does not support sharply higher prices.

So, it seems to me that gold most likely needs to spend several days chopping back and forth between $1,925 and $1,975, consolidating the recent rally. This sort of action would give the short-term moving averages enough time to catch up to, and rally above, the 50-day MA – thereby shifting into a bullish formation.

If that happens, then the gold chart will have the sort of bullish setup that supports a continued move higher toward new all-time highs above $2,050 per ounce.

Best regards and good trading,

Jeff Clark

Have you been watching this gold roller coaster?

Let us know your thoughts – and any questions you have – at feedback@jeffclarktrader.com.