Gold Price Analysis – Gold Pulls Back as Geopolitical Risks and Yields Cap Gains

Gold Technical Analysis

The gold market finds itself a little bit noisy early on Friday, initially falling, but has turned around since then to show signs of life. This is a market that continues to be somewhat hesitant to continue going higher, and perhaps gravity has come back into the fold. But the real problem, I suspect at this point, is that nobody really knows what to think of the environment.

The situation in the Middle East continues to be a major problem, and as long as headlines can come out to cause chaos, we should see a little bit of hesitation by a lot of traders who are a bit worried about external pressures.

Yield Pressures and Technical Signals

The interest rates in America are a little bit higher than they were when the bond markets opened up early, but ultimately, this is a market that has to worry about yields, has to worry about headlines. And the yields, of course, are being driven mainly at this point in time by concerns coming out of the Middle East and whether or not there is going to be significant energy inflation.

The 200-day EMA sits just below, offering support, and the 50-day EMA is starting to rise, possibly kicking off the so-called golden cross, a potentially interesting signal that technical traders sometimes pay attention to.

Markets look a little confused at the moment. After that surge higher, working off some of the froth would make sense anyway. But as we go into the weekend, it’s not overly surprising to me that perhaps traders are hesitant to put on big positions.

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