Gold Price to breakout like the Long Bond did ?

This may be one of the most fascinating chart comparisons I have ever seen.  The weekly gold price chart seems to be following the pattern of the 30 year bond when it had it’s enormous breakout leg last year.

A picture is worth a thousand words and I am going to show you two charts here. One is the weekly gold price chart and then the second is the 30 year treasury bond chart.

First we have here to the left the weekly gold price chart.  As you can see on the chart the gold price has attempted 4 separate times to break out of the down trend resistance line.  On the fourth try it was successful and I also have confirmed that the breakout was on confirmed volume as least as represented by the GLD gold ETF.  After the gold price broke out it did what most normal markets do and pull back to do a classic test of new support level.  We are almost just about done with that right now on the weekly gold price chart.  Ok so now let us take a look at the 30 year bond chart and you can see a similar type price setup and then the resolution.

As you can see if you look carefully at the daily chart of the long bond it also attempted four separate times to break out north of the resistance line. It was successful on the fourth try and it too did the classic retest of the new support level. But what is key about this chart is how the price reacted afterwards.  As you can see it moved very fast in almost a vertical fashion to create the huge breakout of the previous high.

I think the gold price has a decent shot at repeating this type of pattern and we should be able to look forward to near vertical price movement on the weekly chart pretty soon, perhaps starting as early as next week.