Thursday's Market Minute: Gold Futures Breaking Out After Range-Bound Month

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Gold futures have seen a month of range-bound price action and below-average volume, but the yellow metal now could be making a breakout move to the upside. The /GC contract is up almost 3% since April 5 as of yesterday’s close, marking six green candles in a row and pushing above the previous high close from late March.

The month of March gave us an important bottom to watch near 1,920, as bulls proved extremely persistent at this point in terms of shoring up support as price meandered sideways. /GC is now trading firmly above its 21-day Exponential Moving Average, and there are other bullish technical signs to consider, such as Tuesday’s bullish MACD crossover. Additionally, during recent days, the RSI made a push above the 50 midline, the PSAR made a bullish crossover, price closed above the upper Bollinger Band, and the Average Directional Index turned up from a trough, which suggests a potentially strengthening uptrend.

If the uptrend continues, watch for possible resistance at the yearly +2 Standard Deviation Channel just above 2,000. The 1,920 level will continue to be important support, but the yearly +1 Standard Deviation Channel also could offer a foothold near 1,941.

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