Gold Technical Analysis
Gold markets find themselves a little bit negative in early trading on Monday as we are hanging around the 50-day EMA. This is a market that’s been somewhat range-bound for a while, and I think that does make a certain amount of sense with elevated interest rates in the United States. It doesn’t do a lot of favors for non-yielding assets such as gold and silver, for that matter.
So, being range-bound is not a huge surprise. We basically are stuck between $4,500 on the top, $4,300 on the bottom, and really no real momentum to go in one direction or the other at this point.
Middle East and Interest Rates as Key Factors
It’s very likely this is a market that will continue to see a lot of questions asked of it. It does make a certain amount of sense with elevated interest rates that non-yielding assets such as gold might struggle.
That being said, we are in an environment where, if there is some progress made in the Middle East, it might actually lift gold, despite the fact that many traders will be out there looking for safety via gold. Because of the interest-rate situation, it is about energy. As long as energy remains threatened, it makes sense that gold prices will suffer by default.
That being said, we still have a well-defined range, and that is something that I am paying close attention to. This is a market that will continue to be more or less short-term focused from what I can tell at this point. Until we get clarity, things will remain a bit hit-or-miss.
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