Gold Price Outlook – Gold Drops to Find Buyers

Gold Technical Analysis

The gold market has pulled back just a bit during the trading session after gapping lower on Thursday only to turn around and show signs of life again. All things being equal, this is a market that I think will eventually try to send gold much higher. But I also recognize that Friday is non-farm payroll Friday and that has a certain connotation as far as risk appetite is concerned.

Ultimately, this is a market that even if we were to fall from here, the $3,500 range of noise should end up offering pretty significant support. With that being said, I like the idea of finding value if and when it shows up. The question for gold will be, do we pull back towards 3,500 and then go higher? Or do we just go sideways and kill time? It’ll be interesting to see the reaction to the jobs report because it might be impulsive.

I would love to see some type of significant pullback that I can get involved with, maybe early next week. We’ll just have to wait and see. Either way, the one thing that you won’t hear me say is that I’m looking to short this market. It wasn’t too expensive. That’s the thing I keep getting in my email box asking me, can gold really continue to go this high at this rate? And is it too expensive? There is no such thing as too expensive.

There is momentum and momentum dictates that gold’s going higher eventually. Again, we might be a little stretch for the short term, but that doesn’t mean you should become a seller of gold. It means that given enough time, you’ll either see sideways action where the market accepts price, or you see a little bit of a pullback where value is offered. That’s exactly how I’m looking at this.

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