Gold Price Forecast – Gold Continues to Consolidate at Highs

Gold Markets Technical Analysis

You can see that the market has gone back and forth during the trading session here in the early hours of Thursday, as we try to sort out whether or not we can continue the overall momentum. I don’t think that is going to be an easy shot higher, and I would suspect that sooner or later, we will get some type of pullback that we can take advantage of. The $2,200 level underneath is an area where you see a lot of potential support as it was previously noise. If we do get down there, then I think you have a huge value play just waiting to happen, especially with the 50 day EMA sitting there.

We are overbought in the sense that we are well above the 70 level in the relative strength index, which is an indicator that a lot of people use. But quite frankly, just looking at the market, you can see at the very least, we need to work off some of this excess froth. If that’s going to be the case, then we just simply go back and forth for a while, and you take advantage of short-term dips. Either way, I think it’s obvious gold is not a market that you can be short of at the moment, as it is far too strong.

There are plenty of reasons to think that gold will continue to go higher. The least would include interest rates dropping around the world, possibly, geopolitical issues, and quite frankly, the fact that the US treasury is sending trillions of dollars in debt into the market. So, all of this combined just makes for a more attractive situation for gold in general as traders try to protect their wealth. I like buying dips, I don’t want to chase it all the way up here if I can avoid it.

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