Gold Price Outlook – Gold Continues to Grind Higher on Tuesday

Gold Technical Analysis

The gold market rallied slightly during the early hours here on Tuesday as we continue to see a lot of upward pressure. All things being equal, this is a market that, given enough time, probably has to come to some type of pullback that I will be looking at as an opportunity. Somewhere near the $4,400 level, I think you have a situation where value hunters will return to this market and perhaps try to continue the overall upward trend in gold markets.

You’ll notice that there is an ascending triangle on the chart that a lot of people will have been paying attention to, and we have come back to retest that breakout. The breakout and the retest, for that matter, weren’t the cleanest event, but it certainly seems like that is playing out in a classic technical analysis sense.

Targeting $5,000 per Ounce

If the market can reach the measured move of the ascending triangle, you could be looking at $4,900 an ounce for gold. Gold has been extraordinarily strong over the last several months, with the exception of 1 or 2 small pullbacks, and therefore it probably needs to rest a bit. By resting, it generally means either a pullback, which we’ve kind of already had, or sideways action with an upward tilt. I think that’s probably more likely than not.

Central banks continue to accumulate gold, and of course, with central banks cutting rates around the world, especially the Federal Reserve, it certainly helps the idea of higher-priced gold. Currently, I just don’t see a case for shorting this market anytime soon.

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