Gold initially pulled back just a bit during the trading session on Tuesday, reaching the $2,400 level before rallying again and taking off to the upside. Ultimately, this is a market that I think will eventually try to break out and perhaps take out the top of the shooting star from the previous session. Breaking above that would obviously be a very bullish sign, and could send more FOMO trading into the picture.
The $2,450 level has been a bit of resistance, and I think that gets taken out rather soon. In that environment, it opens up the door to the $2,500 level. An alternate scenario would be that we just go sideways, and if that’s the case, the $2,400 level should continue to be supported. If we were to break down below there, then we would just simply reenter the previous consolidation area, which has a massive amount of support underneath the $2,300 level where the 50 day EMA currently sits.
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So, with all of this, I do like the idea of buying dips. And I do think that longer term geopolitics, central bank monetary policy, profligate spending from governments around the world, all will continue to push gold higher. At this point, I don’t really have a longer term target, as the market certainly has a lot to take into account, and of course we have the possibility of further escalation of tension in the Middle East that could really send gold soaring.
Source: Fxempire
