Gold Price Analysis – Gold Continues to React to Wild Rates

Gold Technical Analysis

The gold market has pulled back just a little bit during the trading session here on Wednesday as the 50-day EMA continues to offer a significant barrier.

The market pulling back from here does make a certain amount of sense, considering that rates just won’t let it go, and of course, the men in the Middle East that are responsible for everything won’t stop making comments. In this environment, I think it’s just going to be a situation where it’s difficult for the majority of traders to simply jump in with a huge position.

Sideways Action and Future Clarity

I think ultimately, you’re looking at more sideways action as we’re just waiting for some type of clarity, which is probably not coming. So, I wonder whether or not we just don’t go sideways for a while. This is a market that doesn’t really understand what to do.

If we do break out to the upside above, maybe the $4,800 level, we could go look into the $4,900 level, but if we break down below the $4,500 level, the bottom could fall out. In that scenario, we drop quickly and plunge.

I do believe that gold is going to continue to trap a lot of retail traders as they look for it to behave like a safety asset, and quite frankly, it is not in an environment where interest rates are screaming higher. As long as that ends up being the case I think you’ve got sideways consolidation at best, but someday, we will get a bit of momentum.

If you’d like to know more about how to trade gold and silver, please visit our educational area.