Gold Price Outlook – Continues to See Support

Gold Technical Analysis

The gold market initially pulled back just a bit during the trading session here on Friday but then turned around to show signs of life. By breaking above the 4,000 level, the market is likely to go looking towards the high again, somewhere near $4,080. Anything above there opens up the market to much higher levels. Short-term pullbacks open up value opportunities in a market that, quite frankly, has been extraordinarily strong.

The $3,800 level is a level that had been the measured move from the breakout of an ascending triangle. Now that has been reached and of course broken, any pullback at this point in time will probably look at the $3,800 level as extraordinarily supported. If we break to the upside, then it’s likely we will go much higher. All things being equal, this is a market that I think continues to move on geopolitics, central banks out there buying gold and of course, quite frankly, just overall momentum.

Are we overbought? Yes. Did we have an extraordinary day on Thursday that I think cannot be ignored? Yes. Just look at how the volume spiked. We haven’t seen a move like this in a while. Ironically, the last time we saw this type of volume, it actually dropped. So, I’d be very cautious here. I’m not a fan of shorting, but really at this point in time, the best case scenario for longevity’s sake, in my opinion, is that we go sideways for a while. We’ll just have to wait and see how this plays out.

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