{"id":19407,"date":"2022-02-10T07:30:13","date_gmt":"2022-02-10T12:30:13","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=19407"},"modified":"2022-02-10T07:30:13","modified_gmt":"2022-02-10T12:30:13","slug":"this-sleeping-giant-is-ready-to-breakout","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/this-sleeping-giant-is-ready-to-breakout\/","title":{"rendered":"This Sleeping Giant Is Ready to Breakout"},"content":{"rendered":"

Gold has done nothing for over a year.<\/p>\n

The shiny yellow metal was trading near $1,830 per ounce one year ago… Today, it’s near that same level.<\/p>\n

So, during a year in which the S&P 500 gained 14%, bitcoin rallied nearly 20%, oil surged over 60%, and even Treasury bonds notched a 2% return – gold did nothing.<\/p>\n

Oh sure, the metal has been a bit higher and lower over the past 12 months. But if you bought gold last February and then took a one-year nap, you’d wake up today and not see a difference.<\/p>\n

That’s about to change…<\/p>\n

Gold is on the verge of breaking out of a 12-month long consolidation pattern. And, that break could lead to a monster move.<\/p>\n

Take a look at this long-term weekly chart of gold…<\/p>\n

\"Chart\"<\/div>\n

This chart has formed a year-long consolidating triangle pattern – which is a series of lower highs and higher lows. Gold is approaching the apex of the triangle. So one way or another, it’s going to break out soon.<\/p>\n

We measure the height of the triangle from the low at $1,700 last March, to the high of $1,900 in May (two blue lines). That’s a $200 difference… and that’s the projected move on a breakout.<\/p>\n

In other words, once gold breaks out from this pattern, it’s either headed up towards $2,000 per ounce, or down to $1,600.<\/p>\n

Of course, the obvious question is… Which way will it go?<\/p>\n\n\n\n
\n

Free Trading Resources<\/strong><\/p>\n

Have you checked out Jeff’s free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career \u2013 at zero cost to you. Just click here<\/a> to check it out.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

My bet is to the upside.<\/p>\n

Consolidating triangle patterns tend to break in the direction the chart was going prior to the formation of the triangle.<\/p>\n

In this case, gold started to rally in early 2019. It gained 67% by the time it peaked in mid-2020. Then it pulled back and began consolidating. So, the odds favor an upside breakout.<\/p>\n

It’s not a guarantee… But I like the setup.<\/p>\n

It’s also worth noting that investor sentiment (a contrary indicator) is quite bearish<\/a> towards gold.<\/p>\n

That’s not surprising… Folks tend to get bearish on an asset that doesn’t do anything for so long.<\/p>\n

Those folks have sold out of their positions. And anyone still holding onto the metal after a year of doing nothing is unlikely to sell – no matter what.<\/p>\n

So, it’s hard to imagine where the selling pressure will come from to cause a downside break.<\/p>\n

On the other hand, there’s a lot of potential buying pressure as bearish traders start to become bullish<\/a> on gold.<\/p>\n

So like I said, my bet is to the upside.<\/p>\n

Either way, we should know for sure within the next few weeks.<\/p>\n

Best regards and good trading,<\/p>\n

\"signature\"<\/p>\n

Jeff Clark<\/p>\n

<\/p>\n

Reader Mailbag<\/h2>\n

Do you think it\u2019s time for gold to rally? Or will it stay around its current levels?<\/p>\n

Let us know your thoughts – and any questions you have – at feedback@jeffclarktrader.com<\/a>.<\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Something\u2019s about to change…<\/p>\n","protected":false},"author":49,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-19407","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/19407","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/49"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=19407"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/19407\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=19407"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=19407"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=19407"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=19407"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=19407"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=19407"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=19407"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}