- I see that we are threatening a major break out, but it’s probably worth noting that we are heading into Independence Day trading in the United States, and of course the jobs number on Friday that could cause quite a bit of noisy behavior.
Gold market traders have been very bullish for some time, and quite frankly they have a lot to think about. Geopolitical tensions of course are a major issue, and that does drive up the demand for gold, as traders try to protect their wealth. Short-term pullbacks should continue to be buying opportunities, as the 50-Day EMA underneath is sitting right around the $2320 level. That’s an area that I think a lot of people will be looking to get involved in on any type of value set up, but if we were to break down below there, then we could go looking to the $2300 level.
Technical Analysis
The technical analysis for this market is obviously very bullish, and I do think at this point in time it’s worth noting that the $2300 level is the beginning of the major support level that traders continue to look at, with the $2280 level being the bottom of that overall “support range.” If we were to break down below there, then it’s likely that we go looking to the 200-Day EMA. The $2150 level underneath there is a significant support level as well, and as a result I think this is a market that continues to see a lot of value hunters.
If we do break to the upside, and I think that’s very possible, we will go looking to test the $2400 level. That has been basically the ceiling of the consolidation that we have seen for a while, and I think that might end up being the case going forward. The size of the candlestick on the Wednesday session does suggest that there is a lot of demand, so I have no real thoughts of trying to get short of gold anytime soon.
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