Gold Technical Analysis
The gold market gapped higher to kick off the Friday session, only to turn around and show signs of strength again. By doing so, it looks like we are threatening to break above the $4,500 level again, which is a significant round number that a lot of people will be watching very closely.
This is a scenario where we had broken out of an ascending triangle, we have pulled back a bit to find support, and now it looks like we are trying to continue to the upside.
Jobs Data and Market Stability
It’s worth noting that the jobs number saw an addition of 50,000 jobs last month instead of the anticipated 65,000, and that in and of itself might be enough to put a little bit of pressure on the dollar and hence a little bit of upward pressure on the gold market. Regardless, the overall fundamental situation has barely changed after the jobs report, and as a result, when I look at this chart, I just see continuation happening.
That doesn’t mean that it has to happen today, and it doesn’t mean that you should pile in with a huge position. But what it does mean is that pullbacks will almost certainly continue to be buying opportunities in a market that has been extraordinarily bullish for quite some time.
One thing that I prefer gold over silver at the moment is that gold is more stable. Silver will drop 8% randomly in these lofty areas where gold tends to be more of a steady as she goes type of approach, and I am very bullish on gold. I think given enough time, we could be looking at $5,000. That’s probably later this year.
If you’d like to know more about how commodity markets work, please visit our educational area.