Gold Price Analysis – Gold Grinds at 200-Day EMA as $4400 Resistance Holds

Gold Technical Analysis

The gold market rallied slightly in early trading on Thursday as we find ourselves hanging around the 200-day EMA. That being said, we have given back quite a bit of the gains, and it looks like we’re trying to form a shooting star. It’ll be interesting to see if that actually plays out.

The $4400 level just above us, a swing high, that’s a large, round, psychologically significant figure, and the fact that the 200-day EMA is in the neighborhood all adds up to potential resistance. We’ll have to see how this plays out because we, of course, have the weekend coming and there’s still a lot of noise around the Persian Gulf.

Persian Gulf Uncertainty and Interest Rate Pressures

There are questions as to whether or not a deal is close or not, and generally speaking what we have are American officials saying that we are close and Iranians denying that, and that’s been the game we’ve been playing for a while. This has a major influence on interest rate markets, which of course in turn have a major influence on gold most of the time.

And with a non-yielding asset like gold, we do have to worry about higher rates because, quite frankly, why take the risk when you can get a guaranteed return?

A short-term pullback from here would make a certain amount of sense, and the 50-day EMA is right above the consolidation area that we just broke out of, so that’s an area that might be worth watching to pick up value. If we continue to go higher from here, then it would be a very strong sign for gold, and at that point in time one would think that dip buying might start to commence in the market as people chase returns.

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