(Kitco Commentary) – In my last few pieces, I’ve suggested that stacking gold while it’s moving sideways amid destitute sentiment is probably not a bad idea.

This morning, it’s looking increasingly likely that the $4,000 level will hold, with price finally breaking out of the upper channel I’ve been showing (now identified by the dotted line on the chart below). The next bullish price marker remains a weekly close above $4,250. Beyond $4,250, bulls should expect to face more significant resistance around $4,475, roughly where the bold trendline and minor horizontal resistance converge.

I am looking for price to stay overbought for as long as possible on the daily time frame and to form a higher low before making a quick recovery once the indicator inevitably cycles back down.

To sum up, I do not expect there to be a “V”-shaped reversal in gold, but rather a continued grind as a sustainable price bottom materializes, which would leave plenty of room for stackers to act.

It should go without saying that gold can absolutely surprise to the upside. In my opinion, taking or maintaining exposure despite the expectation of a slower recovery is simply prudent coverage against upside risk.