Gold Price Analysis – Gold Jumps at Open on Friday

Gold Technical Analysis

The gold market has gapped higher to kick off the trading session on Friday, which probably shouldn’t be too big of a surprise. There are a lot of different headlines going around, one of which, of course, was that Trump has said they have canceled the bombing plans of the Iranians, but I think also you have to keep in mind there’s probably some short covering heading into the weekend because who knows what comes out as a headline, and that could throw the bond markets into disarray yet again.

So, with that, I think you need to be very cautious. I think it makes sense that if you were short of gold, once we got close to the $4,000 level, it was probably time to start looking for some type of exit.

Market Outlook

That being said, even if we do rally from here, I think the upside is probably somewhat limited in the sense that the 200-day EMA will more likely than not offer a bit of a short-term ceiling. Breaking above there opens up the possibility of a bigger move, but right now I think we’re pretty far from that.

Again, I have to ask the question of how much of this was short covering, maybe a reaction to the headline, but again, it would take almost nothing to have the markets rattle again. I think this is probably something you need to watch what happens over the weekend. If it’s good, gold probably rallies; if it’s bad, gold probably sells off because of the bond market and higher yields in America, so watch the two.

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