Gold markets tried to rally a bit during the trading session on Thursday but continues to struggle with the $1300 level. The $1300 level is of course a large, round, psychologically important figure. At this point, I think that the previous channel underneath should continue to offer interest in the market, just as the 20 day EMA is underneath, which could also offer support. I think at this point, it’s likely that pullbacks will be looked at as opportunities, as we try to build up the momentum to finally break out and go higher. Once we break above the $1300 level, then we could go looking towards the $1400 level above.
Price of Gold Video 11.01.19
The $1400 level above is of course going to be a situation that will cause a lot of interest as well, as it has been massive resistance. That is my target, but we need to break the $1300 level cleanly before we can start adding to a position. I believe at this point, the market is likely to grind sideways for a couple of sessions, as we try to figure out where to go next. The Federal Reserve stepping away from a hawkish stance is likely going to be a driver of gold higher over the longer-term, and as a result I think that we are starting to see the break out really take off. I think given enough time, the market will probably find plenty of reasons to rally, but in the meantime I’m building up a position for that move higher. If we break down below the $1275 level, then we could have to pull back to the $1250 level to reset the entire situation.
This article was originally posted on FX Empire