The Gold markets continue to hang around the 50 day EMA as we go back and forth in early trading. Ultimately, this is a market that I think will go looking to the $3,500 level again, the area that has been such a major resistance barrier. And if it can break above there, it could really start to take off. A short-term pullback is still possible, but we’ve made a series of higher lows going back all the way to at least November.
So, despite the fact that we see a lot of pressure at the $3,500 level to keep the price down, the reality is this is still very much an uptrend. Gold will be heavily influenced by the US dollar, anticipation of interest rate cuts coming out of the Federal Reserve, and of course, geopolitics. Even if we were to break down below the 50-day EMA and drop significantly here, it’s really not until we break down below the $3,200 level that I think anything has truly changed.
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On a move above the $3,500 level, I’m more than willing to hold a position. Right now, it’s more of a buy on the dips type of scenario. But above $3,500, it would not surprise me at all to see gold go looking at the $3,800 level over the next several weeks, maybe months, as the measured move of consolidation is $300. Gold remains very positive. I have no interest whatsoever in shorting this market, and I do think that once volume picks up, as traders come back to work in September, we’ll probably see a little bit more of a push to the upside.
Source: Fxempire
