The interest in gold at high levels in recent years may also have been fuelled by the interest of China or other emerging markets to diversify their reserves away from the dollar. Whether this was actual demand or just speculation to that effect is not essential. The big question now is whether China or Saudi Arabia will remain net buyers of gold amid shrinking trade surpluses or move into active gold sales to support the growth of their economies.

The long-term picture also points to the formation of a triple top in gold – a reversal pattern. However, its legitimacy is now in doubt amid the rapid upward reversal since the beginning of October.

In any case, the dynamics of gold in the coming days promise to be trend-defining for many months ahead, as we may see either a breakout of long-term and psychologically important resistance or the beginning of a multi-month or even multi-year bear market.