The gold market is going to continue to see a lot of buying pressure every time it drops from what I can see, as the market has been in an uptrend for quite a while. All things being equal, this is a market that has been factoring a lot of different things into the pricing, not the least of which would be geopolitics. With Russia suddenly lowering the threshold for nuclear attacks after being attacked by long range NATO missiles, certainly we have something to think about. Furthermore, we have to keep in mind that central banks around the world continue to buy gold and that of course puts a large buyer into the market anyway.
We have momentum that is working with us as we hover around the 50-day EMA. And of course, we also have central banks around the world cutting rates. Now, the bond markets aren’t necessarily cooperating all the time, as seen in the United States, but at the end of the day, gold makes a lot of sense. We have a lot of countries out there that find themselves getting ready to loosen monetary policy even further when debt is at an all-time high.
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At this point in time, we don’t really know where gold can go as far as a target, but it’s going to be higher than here. The $2,800 level offered a significant resistance barrier the first time we got there, but I think that’s your target right now. I have no interest in shorting this market, nor do I think most people have. If we broke down below the 200-day EMA, it might be possible that we see more negativity, but at this juncture, we have a market that is clearly heading in one direction.
Source: Fxempire
