Chris Kimble on a Potential Breakout in Gold

Recent volatility in stocks and currencies have given safe-haven assets like precious metals a bid. Gold is up nearly 10% since stocks topped out in October 2018. Currently, both Gold and Silver are testing long-term resistance and could be about to break out of a multi-year downtrend that began when Gold peaked back in 2011.

Chris Kimble is a respected technician and founder of Kimble Charting Solutions. Over the past couple weeks, Kimble has been writing blog posts detailing a potential multi-year breakout in precious metals. In a blog post out today, he shared the chart below.

This is a monthly candlestick chart of Gold next to a monthly candlestick chart of Silver. Kimble explains that currently, both precious metals are testing falling resistance levels. He sneaks a little humor into the chart with the image of Ronald Regan and a famous quote that likens the falling resistance to the Berlin Wall. You can read his entire post here.

Another thing that Chris Kimble sees helping precious metals is the potential weakness in the US Dollar. In a post out last week, Kimble explains that a weakening dollar would be bullish for commodities like Gold. He shared the chart below of the US Dollar Index and highlights the bearish rising wedge pattern that's forming. If the Dollar fails to hold support Kimble thinks this would add fuel to a breakout in metals. Read the entire post here.

It’s interesting to see how Chris Kimble uses long-term charts in his analysis as a way to tune out short-term noise and spot changes in the primary trend. Another thing to keep in mind is that if  Gold is breaking out, it is likely doing so within a risk-off environment where equities are selling off. Therefore, it will be important to watch how precious metals behave at these critical levels.