Gold has been positive again, early during the trading session on Friday as it looks like we continue to see a lot of noisy behavior in general. That being said, the $2,000 level has held up quite nicely as potential support. And with that being the case, I think you have a situation where you have to look at this through the prism of a $75 range that is going to be resolved sooner rather than later. If that is the case, then I think gold has a good shot of breaking above the $2,075 level and continuing much higher. If and when it does, then we would be looking at a move towards the $2,100 level initially, more likely than not followed by a move towards the $2,200 level.
Having said that, I would expect a certain amount of choppiness and volatility, but that would be normal in the precious metals markets as they are so sensitive to interest rates. Pay close attention to the 10-year yield because it certainly will have its influence on gold as usual. And on top of that, the US dollar will do the same, although those two will be moving for basically the same reasons. With that being said, we continue to see the same dynamics that we have seen over the last several weeks. Ultimately, I do think that gold has more going for it than going against it, as it has been in an uptrend for quite some time, and for a whole litany of reasons that I can see.
There are a lot of geopolitical concerns out there that could get gold moving as well, so that’s also something worth paying attention to. Clearly, there are a lot of conflict zones that are starting to heat up, and that generally has a run towards safety as well. So, with that being said, I like the idea of buying short-term dips, probably even just buying here if you’re small enough in your position because remember, gold is a very volatile asset. It’s not until we break down below the $2,000 level on a daily close that I begin to worry about the overall uptrend.
Source: Fxempire
