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Gold Price Forecast – Gold markets pull back

Gold markets tested a major downtrend line during the trading session on Tuesday, but then rolled over to form a slightly negative candle stick. At this point, the market looks very likely to drift a bit lower from here, perhaps reaching down towards the 50 day EMA which is pictured in red on charts. On the other hand, there is also the argument for more volatility.
Christopher Lewis
Gold daily chart, May 15, 2019

Gold markets initially rallied a bit during the trading session on Tuesday but has found a significant amount of resistance at the downtrend line I have marked on the chart. The $1300 level of course offers a significant amount of psychological resistance as well, so I do think that we could very easily pull back from here and go looking towards the 50 day EMA which is pictured in red on the chart. Beyond that, we could go down to the 200 day EMA which is closer to the $1277 level.

Price of Gold Video 15.05.19

The alternate scenario of course is that the markets panic for some reason, and therefore send traders into the gold markets to try to pick up a little bit of safety. A break above the highs from both the Monday and Tuesday session could send this market looking towards the $1315 level. At that point, we could even go to the $1325 level.

In general, this is a market that has been grinding lower and we could see more downward pressure going forward if the economic conditions and more importantly the markets calm down a bit. Gold may have gotten a bit overbought, so a return to lower pricing could make quite a bit of sense. At the moment, it makes much more sense that we go lower than higher, but one bad headline involving the US/China trade situation could change everything.

Please let us know what you think in the comments below

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