Gold Price Analysis – Can Gold Eventually Break Above the Massive Level Above?

Gold Futures Technical Analysis

The gold market tried to break above the $5,000 level again during the trading session on Thursday but has turned around to fall to test the $4,800 level. A little bit of observation probably goes a long way here as we could find the next range. The question is: will it be at the $4,600 level underneath and the $5,000 level above, or will support be found at $4,800?

I think the best move is probably going to be avoiding this market all together. I certainly wouldn’t want to short gold because there are central banks around the world continuing to accumulate it. Of course, there are a lot of debt issues that people will be looking for gold to perhaps help with and geopolitical problems. Because of this, I think it is likely that we will continue to see at least some demand for gold.

Market Sentiment and Technical Outlook

Ultimately, I do think that a drop and a bounce open up the possibility of following the trend, and so far, we are getting that drop. We haven’t seen the bounce yet. I would look for daily candlesticks to perhaps help, and I would also have my position size small enough that I don’t have to worry about wild swings.

Quite frankly, you need to worry about wild swings in this market. It is obviously in a bullish trend, but this candlestick that we formed last Friday really puts a lot of people into a very sordid state right now and I think that continues to be the story here.

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