Gold Faces $4,150 Resistance Before Its Next Breakout

By Amara Osei

Gold must break above $4,150 to extend a downtrend breakout first cleared on 4 November after the US midterm election results, according to Michael J. Kramer, founder of Mott Capital Management.

Kramer said gold prices have consolidated around $4,150 since late September. He said a break above that level could open the way to about $4,250, a former support level now acting as resistance.

What must gold break to confirm the move?

Gold’s relative strength index has broken above its own downtrend and risen above 50, Kramer said. He said the change suggests bullish momentum is improving and could support a further rise in gold prices.

Kramer presented the momentum improvement alongside the price hurdle. The improved RSI supports a bullish interpretation, he said, but gold still needs to clear $4,150.

The 50-day moving average sits near $4,200, Kramer said. He said it could offer resistance if gold tests the average on the way toward $4,250.

Kramer’s technical sequence starts with a break of $4,150. It then places the 50-day moving average near $4,200 between the current consolidation range and the $4,250 resistance level. Gold has not completed that first step, so Kramer’s route to $4,250 remains conditional.

How could the dollar change the setup?

Kramer said most of gold’s recent price moves appeared driven by the US dollar index, which eased after peaking in mid-October. Following a strong jobs report on 6 November, attention turned to US inflation figures due on 10 November.

The inflation release creates two conditional paths in Kramer’s analysis:

• A stronger-than-expected reading could lift the dollar, Kramer said. He said that would make gold’s $4,150 resistance harder to break.
• A softer reading could ease expectations for Fed rate rises, Kramer said. A weaker dollar could then give gold a further boost.

Kramer said gold shows signs of a potential move higher. His conclusion remained conditional: gold still needs to clear $4,150, and a stronger dollar could obstruct that advance.

Kramer’s setup combines an improving technical signal with a dollar-driven macro risk. The 10 November inflation release can lift the dollar or weaken it, and Kramer said either response would alter the odds for gold’s $4,150 breakout.

Kramer’s chronology begins with the 4 November move after the US midterm election results. A strong jobs report followed on 6 November, and US inflation figures are due on 10 November. In Kramer’s analysis, that sequence leaves the 10 November inflation release as the next stated catalyst.

What are the limits of the analysis?

Kramer wrote the analysis for CMC Markets, which describes itself as an execution-only service provider. CMC said the material is for general information and does not take account of readers’ personal circumstances or objectives.

CMC also said the material is not financial, investment or other advice on which reliance should be placed. It said no opinion in the material constitutes a recommendation that any security, transaction or strategy suits a particular person.

The company said the material was not prepared under legal requirements designed to promote the independence of investment research. It added that CMC is not specifically prevented from dealing before publishing, although it does not seek to exploit that position.

Kramer’s next test is concrete: gold needs $4,150 before the 50-day average near $4,200 and the $4,250 level become the relevant markers. The 10 November inflation data and the dollar’s response will help determine whether gold clears the first threshold.