Gold Price Analysis – Gold Continues to See Buyers on Wednesday, Focus is on $5,000

Gold Technical Analysis

The gold market has rallied quite nicely during the early hours on Wednesday as we continue to see a lot of concerns about trade due to the Greenland spat between the United States and Europe. And of course, a whole host of other geopolitical issues have come to the forefront as well.

All things being equal, this is a market that I think will eventually find the $5,000 level. But I also recognize that we may need to pull back a little bit in order to find that momentum.

Gold looks very strong, and I certainly wouldn’t short it, but what I will do is wait for a pullback in order to pick up cheap gold because that’s been the play for several months, and I don’t see that changing anytime soon.

Ascending Triangle Target Hit

For what it is worth, when you look at the ascending triangle that we broke out of a couple of weeks ago, we have basically hit the target. It was somewhere near $4,900. So maybe that has technical traders exiting the market?

I also recognize that the $5,000 level will be a major psychological barrier that a lot of people pay close attention to, with the idea being that if you are very positive in your position at that point, you might as well take your profit out of the market.

There are probably quite a few options played out there as well, so I think all things being equal, the $5,000 level will be a big battlefield. But it will also be a magnet for price. So, I do think we get there. A little bit of a pullback to build up the necessary momentum might help as well, since we are a little overstretched.