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Christopher Lewis
Gold daily chart, December 21, 2018

Gold markets rallied significantly during the trading session on Thursday, breaking well above the $1255 level. At this point, it looks as if this market could continue to grind its way to the upside, especially if we can get some type of “safety trade” going in the precious metals market. If we break out to the upside, we could go as high as $1400 and still stay within the longer-term consolidation. I think that at this point, it is the most likely path, but be careful with leverage, because quite frankly it’s a dangerous market that we find ourselves in right now, not to mention the fact that liquidity will be a bit of an issue. Keep your position size small, but I think you should be looking to the upside at this point. With the holidays upon us, it’s probably easier to simply buy short-term dips, even if it’s just for very small position.

Price of Gold Video 21.12.18

If we were to turn around and sliced through the $1200 level, that would signify that we are ready to break down drastically. Overall though, I do think that the market is probably more apt to simply bounce back towards the $1400 level. Be cautious, perhaps using the CFD market, or better yet the physical metal if you can get your hands on it, as futures markets could get knocked around drastically in a low liquid environment. I do think that we are going to see some strength in gold due to fear overall.

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