The oil price handed over the baton to the gold price this week, with oil retreating steadily and the $ price of gold rising steadily to break up through resistance.

On Friday, gold closed at 432.90 and the $XAU closed at 106.86. Friday marked the highest one day close for gold in 16 years and marks the defeat of the 430 14-year resistance level for gold.

Gold had a crack at breaking out above $430 yesterday, and managed to get to $433.13 before being beaten back, but what was more important was that the dollar broke down below its lows of last February.

The gold technicals appear now to have broken out of the corrective phase, or has it? This question has cost the Technical Traders dear,so far this week.

Many investors and traders that have a keen desire for higher gold complex prices, believe that it will be wonderful when gold finally breaks free from the shackles that have long restrained it, and soars wildly higher in price. Some of these individuals believe that gold is headed towards $600 while others can barely contain their emotions believing that the sky’s the limit.

Gold has been acting very positively in recent days and now, at last, is ready to take out the key resistance at $430. There are several very crucial points to make here. The importance of the $430 price level is emphasized by the fact that gold double-topped at this level back last winter and spring, so the fall of this level will therefore have a huge positive psychological impact, and result in the rapid conversion of a lot of disbelievers.

Gold did not perform well in Euros this week. Having broken all the way up to Euros 340 previously, it pulled back to Euros 334 early in the week to stay there for three days before falling back to 332, then recover to Euros 334 at the time of writing.

Why so much Fund buying and selling of gold you may well ask? It is a stark contrast to the behaviour of the Hedge funds ahead of the Iraq war, when they drove the gold price up from $320 to $390, then all the way back again, once the war had started.

Much has occurred during the past few months that drew me to the conclusion that gold and gold equities are approaching a period when they will shortly resume their secular Bull Market advances.