Gold Price Outlook – Gold Continues to See Overhead Resistance

Gold Technical Analysis

The gold market is very noisy again during the trading session on Tuesday, as we are hanging around the top of a channel that we have been in for a while. And I think ultimately this is something that you have to keep in the back of your mind, as far as the attitude of the market is just simply strong. And every time we do pull back, as we did early in the day, we seem to have some support.

Potential for a Deeper Correction

What I find interesting, though, we formed two shooting stars in a row on the daily chart. So, I do think a little bit deeper correction could be in the works here. I don’t think it changes the trend at all. I just think you have a situation where we could go looking at the $4,200 level. The $4,200 level of the course is a large, round, psychologically significant figure that’s been around in this market for a while and has caused quite a bit of noise.

I think that continues to be the case. And therefore, I look for value going forward in the form of cheaper gold. That being said, if we can break above the $4,400 level, then I think we just kick off the next leg higher. I do expect that to happen eventually. I just think in the short term, maybe we’ve got a little bit of volatility ahead of us. It would make a certain amount of sense.

I believe the Bank of England, the European Central Bank, and the Bank of Japan all have interest rate decisions in the latter part of this week. So, if that’s the case, maybe gold traders are kind of trying to get a feel as to what central banks around the world are doing. But in the longer term, I don’t think the trend has changed.

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