Gold Price Forecast – Gold markets benefit from soft US dollarGold markets rallied significantly during trading on Monday, as the US dollar lost a bit of strength.
Gold markets rallied significantly during the trading session on Monday, gaining over 0.5% by the time the Americans went online. However, there is a lot of noise above, especially near the $1210 level, so I think that the rally will be somewhat short-lived. After all, there are more than enough reason to think that the US dollar could gain strength, if nothing else due to significant concern with emerging markets.
Trade war fears continue to be a major issue as well, which almost certainly looks likely to pick up a bit. I think that the Gold markets will continue to be very range bound, with the $1195 level underneath the be supportive, and the $1215 level above should be resistive. Overall, this is a market that I think should continue to see volatility, but I also recognize that we are more than likely going to move with the US dollar, as we have seen for some time now. I think at this point though, it’s probably easier to short this market at higher levels than anything else, because the move has been extended so rapidly during the day on Monday.
It’s very likely that we will see a return to lower levels, as I think there are so many issues out there that could scare people back into US treasuries, driving up the value of the US dollar, and therefore working against the value of precious metals in general. As I stated in my silver analysis, when I’m looking to buy precious metals, I do it in gold, and if I’m looking to sell precious metals, I do it in silver.