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Christopher Lewis

Gold markets initially rally during the course of the trading session on Friday, but then pulled back to show signs of profit-taking heading into the weekend. That makes quite a bit of sense, considering that we have bounced roughly $50 and just a few short days. I think at this point though, what we are looking at is a potential buying opportunity on a pullback. Looking at this chart, the market is likely to find plenty of buyers underneath, as we have seen such a massive shot higher.

Gold Price Predictions Video 07.12.20

Looking at the chart, you can see that the 200 day EMA sits right around the $1800 level. At this point, it looks as if the longer-term indicators will continue to come in and push higher, and therefore I think that there are plenty of longer-term traders are willing to get in and hold onto gold. With the Federal Reserve out there looking to flood the markets of liquidity and supported by any means necessary, that should help gold. Beyond that, the US dollar has gotten hammered and that of course has a major influence on this market in general. To the upside, the 50 day EMA sits at the $1873 level, which is dynamic resistance. If we can break above there, then the market is ready to go looking towards the $1900 level.

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That is a large, round, psychologically significant barrier, and an area where we have seen reactions in both directions multiple times. Longer-term, I believe that gold goes looking towards the $2000 level, possibly even the $2100 level which was the most recent highs. I have no interest in shorting gold anytime soon.

For a look at all of today’s economic events, check out our economic calendar.

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