Gold Price Forecast – Gold continues to look softGold markets when sideways initially during the day on Friday, hanging about the $1250 level. That’s an area that has been important more than once, and I think that the fact that we are offering a bit of support here is a huge surprise, but at this point we are most certainly in a downtrend.
Gold continues to look soft, and I think it’s difficult to imagine that things are going to change anytime soon. That’s not to say we won’t have a short-term rally, but I think that selling is the easiest thing to do after signs of exhaustion. At signs of exhaustion, I think that the overall attitude of the market will continue to the downside. The $1260 level, the $1275 level, and of course the previous uptrend line all offer significant resistance. I don’t think that we will be able to rally for any significant amount of time, as Gold has broken major support levels recently.
On fresh new lows, there would be seller’s as well, reaching down towards the $1225 level. I think at this point, the 50 EMA continues to offer dynamic resistance on the hourly chart, and obviously the 200 EMA will as well. Signs of exhaustion are to be sold, and at this point I have no interest in buying until we break above the uptrend line. Now that’s not to say that there won’t be some type of supportive candle lower in price and higher in timeframe that I will be willing to start buying from, but right now I don’t see it forming.
If the US dollar continues to strengthen in the Forex world, that will also put a bearish attitude in this market as Gold is priced in US dollars.