Gold Technical Analysis
The gold market has fallen a bit to kick off the trading week as we are hanging around the 200-day EMA, trying to figure out where to go next. This market will continue to see this as an important level to watch.
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See all Gold forecastsThat being said, the market is a little oversold as far as the range is concerned that we have been in for the last couple of weeks. So, let’s see how we behave here.
The interest rate situation continues to be one that is very conducive to potential selling of non-yielding assets such as gold.
Energy Inflation
As traders are trying to price in inflation from an energy standpoint, the Federal Reserve has an interest rate decision and press conference on Wednesday that will almost certainly have an influence on this market. So, in the next day or two, it could be a bit quiet with more of a sideways tilt. We’ll just have to wait and see.
Either way, this is a market that does not look overly bullish. In fact, we could even make an argument for a little bit of a head-and-shoulders pattern. If that were to break down, basically right around the $4,325 level, that could technically, at least, be a very bad sign.
Just as a bounce from here could be a good sign, in the sense that we could be looking at more continuation of the overall grind sideways. Gold, I suspect, will probably be watching the Federal Reserve very closely on Wednesday, and of course, bond yields in America, as we are trying to price in energy inflation, thereby driving yields higher.
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