Peter Smith
⬤ Gold recently hit resistance at a trendline that's held for over 40 years—a level that triggered long-term downtrends twice before. The chart shows three distinct touches of this line across more than four decades, and each previous rejection led to multi-year declines. The big question now is whether this latest pullback will follow the same pattern.
⬤ The technical setup comes at a time when proposed tax changes could reshape commodity markets. Potential shifts in capital gains treatment, higher transaction taxes, and stricter reporting rules might reduce market liquidity and create pressure on smaller trading firms. While these policy considerations weren't part of the original analysis, they add uncertainty to gold's outlook.
⬤ The current rejection looks similar to the previous two cycle tops, but today's environment is different. Persistent fiscal pressures, elevated geopolitical tensions, and strong demand for safe-haven assets could break the historical pattern. Gold pushed sharply into the resistance slope before turning lower—consistent with past behavior—but whether it follows through with another multi-year decline remains unclear.
⬤ With long-term resistance, macroeconomic stress, and possible tax changes all converging, this moment feels significant. After two historical downtrends from this same level, the market is watching to see if gold repeats history or finally breaks through a 40-year ceiling.
Peter Smith
