- Gold markets initially plunged during the trading session on Thursday but have turned right back around to show signs of life as it looks like we are ready to go higher given enough time.
- I also recognize that there is a massive amount of support underneath anyway, so this all ties together quite nicely.
- Ultimately, I do believe that this market goes higher because there are so many things out there to be worried about that it makes quite a bit of sense that we would see gold strengthen.
Technical Analysis
The technical analysis for this market of course is very bullish, as it has been for some time. The 50-Day exponential moving average sits just above the $2300 level, an area that obviously is a large, round, psychologically significant figure, and an area that has shown a significant amount of support for the fact that we turned around to show signs of life again. Ultimately, I do think that we could go looking to the $2350 level, an area that has been resistance. If we can break above there, then the market could go looking to the $2400 level, which of course is a large, round, psychologically significant figure that a lot of people will be paying close attention to.
On the other hand, if we were to turn back around and break below the $2300 level, that opens up the possibility of a move down to the $2200 level, but right now it doesn’t look very likely. I still believe that there will be plenty of buyers in the gold market, not only due to the fact that the United States is borrowing $1 trillion every 90 days, but also the fact that we have seen a massive amount of geopolitical concerns out there to cause everybody a headache.
I believe that you continue to buy on dips, and just look at gold through the prism of whether or not it is offering any value at the moment. If it is, then you take advantage of it as the Gold markets have been one of the best performers for some time, and I think that continues to be the case going forward.
Potential signal
- I am a buyer of gold right here, right now, with a stop loss near the $2325 level.
- I am aiming for the $2365 level.
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