Gold Price Analysis – Gold Jumps with Peace

Gold Technical Analysis

The gold market has jumped during the trading session here on Wednesday, as interest rates, of course, have plummeted in reaction to the ceasefire being agreed upon in the Middle East. The market looks very much like one that is trying to break back to the upside, and it looks like it probably tries to get to the $5000 level, but it might be noisy on the way up. I don’t think it’s a straight shot like a lot of people may have thought.

Interest Rate Correlation

The $4600 level will continue to be very important as support and I pretty much tie that to the 4.30% interest rate in the 10-year yield in the US. I just noticed a correlation there recently. So, I’ll be watching both charts, but a pullback here should offer a buying opportunity in what could end up being a bigger move over time.

It’s just we may have gotten a little bit ahead of ourselves because, as things stand right now, just above the 50-day EMA, we’re still up 3%, and that’s a pretty strong move. If we break below $4600 that would tell me something’s rotten here and that we’ve got a real problem. Obviously, you have to keep an eye on headlines coming out of the Middle East. If things suddenly flare up again, that probably sends gold plunging and rates rising. This isn’t the default setup at the moment, but it is something that I would suggest keeping an eye on, as the move could be rapid, as panic could set in quickly.

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