No Such Thing as a Triple Top - Gold Price Analysis

With gold prices falling backward on Monday, you'll soon hear another chorus of top-callers on the internet. As such, just a quick post this week to remind you that there is no such thing as a "triple top", and recognizing this fact can help you structure orders to buy the dip.

How To Analyze Gold Price Charts Effectively

Perhaps the simplest way to explain these features is via price chart. As I type on Monday morning, June 16, the daily chart of the front-month August gold looks like this:

Gold Price Chart

Both the inexperienced trader and agenda-driven permabear will see this chart and then claim that "gold has just made the dreaded triple top"—as if this is some sort of well-recognized chart formation that now spells doom for the current price trend.

Gold Price Chart

However, there's one major problem with this "analysis": there's no such thing as a "triple top"! There are double tops and there are double bottoms, but there's no such thing as a triple top, despite the abundance of bearish commentary that appears every time gold makes three consecutive highs at nearly the same level.

What you are seeing instead is a trading range of price consolidation with the three peaks delineating the upper boundary of the range. Recognizing this will help you find areas of resistance and support in the short term. At present, the range looks like this:

Gold Price Chart

Bullish Gold Trends Since 2023

Remember, the larger pattern is decidedly bullish with higher highs and higher lows that date back to October of 2023. As long as this pattern continues, you should expect the current price consolidation and range to be resolved to the upside.

Gold Price Chart

Best Time To Buy Gold On A Dip

So now let's return to the daily chart—the one with the supposed "triple top" that internet experts are bound to claim foreshadows a coming deep drop in price. Once we eliminate the triple top folly, a different pattern emerges, and it's one you can use for timing purposes if you are looking to add to your stack of metal in an economical way.

This final chart reveals the true pattern. Price is pressing up against resistance with rising support of trend lines and short-term moving averages. As such, dips should remain shallow and there are opportunities for accumulation ahead of the next price breakout above $3500/ounce.

Gold Price Chart

Investing Opportunities In Gold And Silver

For this week, with the current geopolitical stress and pending FOMC meeting, any pullback to the 20-day moving average (red line) and/or short-term trend line (blue arrow) might be such an opportunity. A deeper pullback to the 50-day moving average and/or intermediate trend line (green line and arrow) would present an even more attractive price point.

In summary, beware the top-callers this week and do not let them lead you astray. Instead, expect the bull market pattern of higher highs and higher lows to continue, and be prepared for a summer rally that might catch even the most bullish of prognosticators by surprise.

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