Although gold is already technically in a bull market since bottoming over a year ago, the real bullish signal is still missing.  So, while the yellow metal reached above the 20% threshold for a bull market run, it is hard to like it right here.

But the trend is to the upside, right? Well, technically it does move from the bottom left of the chart to the top right. And it sports higher highs and higher lows – more or less.  And it is above both it's 50- and 200-day moving averages.

All of these things define a bull market. So why the skepticism?

One big problem I have with gold right now is the strong level of resistance overhead. And during this so-called bull market since December 2016, gold failed not once, not twice but three times to pierce $1360, give or take a buck or three.

You can already see that the “higher high” thing from above is not really true. Gold set three similar highs, not higher highs, and that is an issue. It seems that traders are not willing to commit to any price forays above 1360.

I will give the bugs a reasonably bullish setup with the last two touches of resistance in January and February being quite tight together, time-wise. The pullback did not last long. Any market that hits resistance but holds its ground reasonably well is probably just still gathering its strength. It is less likely to be an insurmountable price ceiling.

But then again, there is still no breakout and that is all that matters.

Now let’s put that in greater context. The wound-licking base that formed after gold’s last real bear market is still in progress. In fact, resistance there is not all that far above resistance for the shorter-term move higher.

The funny thing about resistance is that it is additive. The more times, and in the more time frames, a resistance zone turns back rallies the more powerful it is. That means it is especially difficult to breach it but if and when that breach happens it will be a pretty good bet there will be plenty of upside ahead.

But I have to come back to this point – no breakout yet.

Yes, I did say the formation now in place looks kind of bullish so it is no wonder gold bugs, those who root for metals all the time, are getting bolder.

Now, look at this chart. Gold mining stocks do not confirm this bullish potential. In fact, they set lower highs over the past year and arguably a lower low just this month! What’s up with that?

While we look at a potential resistance break to the upside with the metal, we also must look for a potential support break to the downside for mining stocks.

The ray of hope for the bulls is the sizeable bullish reversal seen February 9 in the Gold Mining ETF (GDX). The bad news is that whatever bullishness that created may already be gone as the ETF gave up practically all of the ensuing gains.

Sigh!

It is so very unsatisfying to write that a market did not do something but that’s where we are with gold. And now with the U.S. dollar index (DXY) threatening to confirm a short-term bottom, the headwinds for gold could get stronger.

So, the message here is to get ready but keep your powder dry.