Gold Price Forecast – Gold at a Major Confluence

Gold Technical Analysis

The gold market has shown itself to be a little bit hesitant to break down at what looks like a fairly significant uptrend line going back to the beginning of the year. Furthermore, we also have a demand zone between the $4,200 level and the $4,000 level going back multiple months. This area continues to be important for technical traders.

Interest Rates Moving Markets

The question now is going to be about interest rates. So far during the day on Tuesday, they are starting to drift a bit lower, and that is the main thing for gold at the moment. Keep in mind, there are still concerns about energy inflation, and that will continue to be a major problem.

Ultimately, this is a market that, over the longer term, I do like because of all of the debt and financing concerns in various countries around the world, France being the one in the headlines at the moment. It does make a certain amount of sense that people do like the idea of owning gold, as there is so much uncertainty out there at the moment.

Rallies at this point in time, though, will probably face some headwinds, not only from the bond market and the concerns of energy, but also from the moving averages that are now crossing, with the 50-day EMA and the 200-day EMA indicators looking like a potential resistance barrier.

Nonetheless, we are in an area of confluence, and typically that means we’ll have to make a longer-term decision fairly soon. With a little patience, the market should finally tell us where it is going soon.

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