Gold Market Update
Source: GoldSeek, Clive Maund (1/26/09)
"Gold is now in position to break out to new dollar highs and embark on a very powerful run."
Gold still has considerable work to do before it can break free from the lengthy reaction phase from last March. It needs to clear the resistance at the September–October highs and break above the downtrend channel return line, and then go on to break above the highs of last March. But the rapidly worsening outlook for the dollar means that gold is likely to make light of these tasks.
That the outlook for the dollar is bleak should hardly be surprising given that both the bond market and the dollar can be expected to collapse in unison; and last week the 30-year Treasury Bond suffered its heaviest weekly loss in 22 years. The 10-year Treasury Note is on the verge of doing likewise, whereupon the entire Treasury complex will be at risk of cratering.