Gold Price Forecast December 5, 2017, Technical Analysis

Gold markets gapped lower at the open on Monday, reaching towards the $1275 level, an area that has been important more than once. I believe that if we can break down below the $1270 level, the market probably drops down to the $1250 level after that. That’s an area that was “fair value” on the longer-term charts, and therefore I think that it makes sense that we would go down to that level. This could be a reaction to the US dollar rallying after it looks like the US Congress might pass a tax bill after all, and that of course should be good for the dollar. Because of this, precious metals will continue to struggle overall, and that should play itself out if the US dollar continues to show strength.

However, if we were to break out above the $1280 level, the market could go to the $1270 level. In general though, I believe that the market should continue to be more negative than anything else, so I believe that the US dollar rallied against the Japanese yen could be used as a proxy in this market as they are both moving for the same reason. Ultimately, if we see a failure by US Congress when it comes to the tax bill, that could reverse everything, and the gold markets will probably spike towards the $1300 level. However, what we have seen by the Congress over the weekend suggests that we will in fact continue to favor this market going lower.

Gold Analysis Video 05.12.17