Gold Bulls Still Have Power, Eye New High

December Comex gold futures have made a solid price rebound from last week's low and are once again poised to challenge the contract and all-time high of $1,072.00 an ounce, scored last month. Gold prices remain in a four-month-old uptrend on the daily chart. The bulls remain in technical command amid no strong early clues that a market top is close at hand.

Tuesday's gains in the precious yellow metal, despite a stronger U.S. dollar against the other major currencies, is another bullish clue for gold. Usually, gold prices and the U.S. dollar index trade in an inverse price relationship. A close in December gold futures above the contract high of $1,072 would provide the bulls with fresh upside technical power and would suggest a quick challenge of resistance at $1,100.00 an ounce. It would take a close in December gold prices below strong technical support at the $1,025.00 level to produce some near-term chart damage and provide the bears with fresh downside technical momentum. Stay tuned! Jim Wyckoff