Gold Technical Analysis
The gold market has been a little bit negative during the trading session on Wednesday in the early hours, but it looks like we are still very much in the same consolidation area that we had been in.
The $4,300 level continues to be support, with the $4,500 level above being a resistance barrier. The market at this point in time looks like a situation where we are more sideways than anything else. However, if we were to turn around and break down below the recent bounce, then that could open up a move down to the uptrend line.
Interest Rates Continue to Be a Key Driver
If interest rates do continue to rise, that could work against gold. There is a lot of debt in the world and there is a lot of fear in the world, but that seems to be ignored, at least in the short term, because of interest rates. I think this is a simple matter of watching how they are going.
The 10-year yield in America is right at 4.99% again, and that is something that is going to be a major mover of this market. Headlines could as well, coming out of the Middle East. If we get some signs of progress, that could send gold higher, as it should send rates lower.
But as I said, right now, as a technical trader, I am probably looking for some type of bounce closer to the $4,300 level. I expect messy and choppy trading, but whether or not we get any significant move, we will just have to wait and see.
If you’d like to know more about how to trade gold and silver, please visit our educational area.
