Gold Price Forecast – Gold markets rally from bottom of consolidationGold markets rally during the day on Wednesday, reaching towards the $1300 level again as we have reached towards the bottom of the overall consolidation. The $1293 area has been supportive as of late and rallying from there makes quite a bit of sense.
Gold markets when sideways initially during trading on Wednesday but have rallied a bit as the market continues to show a bit of a “risk on” attitude in the currency realm. As we are waiting for the FOMC Statement, it’s likely that the gold participants are simply trying to hedge their bets. We have been over the last several days, and that tells me that the market is essentially stock. I believe that the market probably is awaiting not only the statement from the FOMC, but also the work coming out of the European Central Bank tomorrow. With that in mind, I believe that we will have a lot of volatility, and I think that it’s only a matter of time before we get some type of impulsive move that we can follow.
The easiest analysis I can do for this market is simply wait for some type of break out of the consolidation. If we can break above the $1305 level, the market could continue to go much higher, perhaps reaching towards $1325 level. Otherwise, if we break down below the $1290 level, the market will probably go down to the $1275 level. In the meantime, expect a lot of noise but I am bullish longer-term, and I think that it’s only a matter of time before we rally, but that’s a longer-term investment type of situation more than anything else. Longer-term, I believe that we will break out above the $1400 level, but it’s going to take some time to get that type of momentum.