Asset Watch
Thursday June 27, 2024
Well, if history is any indication, you should pay close attention to gold’s 10-month moving average. It was a major support level, and gold didn’t close below it during the 2009 to 2011 bull run. Likewise, a similar dynamic occurred in 2019-2020, as the March 2020 intramonth dip was bought, and the yellow metal closed above the 10-month MA.
The 10-month MA is acting as support in November and December 2023, and February 2024, so long-term bulls may have a good reason to be optimistic when the yellow metal trades above it.
Gold is meaningfully above its 10-month MA now, and sharp spurts during 2009-2011 and 2019-2020 were followed by cooling-off periods. As a result, gold may consolidate and eventually reconnect with its 10-month MA. But, if it does, it could be an attractive entry point for those who share BofA’s optimistic outlook.
So, are the stars aligned for gold to shine, or will a correction hit before this bull market resumes?