Gold is up by 0.15% today as buyers search for a potential break higher
Notably, price is rising above the key trendline resistance and buyers will be looking to hold a firm break above that to solidify a break away from the narrowing wedge pattern.
However, without any key fundamental catalysts to support the move, I would feel more comfortable of any upside break if price can rise above the $1,510-12 region and even more so if price takes out the early October highs near $1,519.
Looking at the price action over the past two days:
The slight tilt higher in gold has little to do with the risk mood as it is diverging from bond yields, which are holding virtually flat on the day and pretty much near unchanged since the start of trading yesterday.
That indicates that there has not been a material shift in risk sentiment and yet gold is holding gains from around $1,490 to $1,506 currently.
As such, I'd be wary of the move higher as it could get pegged back by fundamentals down the road. That said, you can't ignore the technicals as well.
As mentioned above, the slight break here is encouraging for upside momentum and a potential breakout but I'd feel much more comfortable as a buyer if there is a break above the levels highlighted above between $1,510-19 in this case.
