Gold Bugs Look for a Breakout

Anthony Bradshaw | Getty Images

iiTrader Founder & Chief Market Strategist Rich Ilczyszyn reveals key levels he's watching during Thursday's session to determine whether or not gold is trying to make a bullish breakout.

Ilczyszyn's Analysis

Gold pulled back to hold a higher low at $1676.2 Wednesday night as the market chopped around.

Today, gold must move through the $1684.9 highs, which is also where a secondary trend line sits. After hitting this wall all week, futures and commodities traders will start to get jittery and look to exit longs or outright sell without a further move higher.

Still, a close above $1688 and furthermore $1696-$1698 is needed to signal a bullish breakout in gold .

Pullbacks below last night's $1676.2 and furthermore, Wednesday's $1673, will be discouraging – but only a close below the 200-day moving average at $1667 will likely cause further liquidation.

Still, a bearish reversal signaling a move to $1600 only comes into play with a close below $1642.6-$1641. A continued close above $1678-$1681 is needed to maintain momentum.

So what's my trade?

I am getting long a breakout above $1684.9, and I will stay in the position as long as we stay above $1680. My target is just above $1700.

Contact Futures Now

  • Showtimes

    Watch Futures Now Tuesdays & Thursdays 1p ET exclusively on cnbc.com!

Sponsor Links

  • CME Group brings buyers and sellers together through its CME Globex electronic trading platform and trading facilities in New York and Chicago.

  • Take your trading to the next level with a platform that lets you trade stocks, options, futures and forex all in one place with no platform or data with no trade minimums. Open an account with TD Ameritrade and get up to $600 cash.