Gold Price Forecast – Gold markets explode to the upside on FridayGold markets exploded to the upside, reaching towards the $1220 level. That’s an area where we have seen a lot of supply, but longer-term charts have formed a hammer, at least on the weekly timeframe. The $1200 level underneath offers a lot of support, and I think it’s only a matter of time before buyers come back into this market plays, but we need to see the US dollar lose some strength.
Gold markets broke down for most of the week, but Friday was very bullish. We reached towards the $1220 level, an area that offered a lot of supply. The market looks likely to roll over a bit here, but longer-term charts show that there is a lot of support underneath. This is especially true near the $1200 level, and the weekly candle that we are forming is a hammer. Pullbacks at this point should be buying opportunities, and I think that the value hunters are starting to come back in into this market.
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If we can break above the $1225 level, we then should continue to go higher. I believe that the market will continue to be very noisy, but I also believe that the closer we get to the $1200 level, the more likely we are to have plenty of value hunters. I think that the market breaking below the $1200 level would be very destructive, and it would break down the gold market overall. I don’t think that the market is good to be easy to deal with, so keep that in mind. I’d be somewhat quick to take profits if I have a lot of leverage on, but physical traders may be looking to pick up value all along this core door of trading that we have seen.