Gold Price Outlook – Gold Drifts in Early Wednesday Trading

Gold Technical Analysis

The gold market has been slightly positive during the trading session here on Wednesday, as we continue to hang around the crucial 50-day EMA, it’s almost acting as a trend line. So, it’s interesting to see how this is just grinding away. Nonetheless, I think this is a market that will eventually go looking at the $3,500 level above, which is a major resistance barrier and of course a large, round, psychologically significant figure that attracts attention.

When I look at the chart, I see a market that is in the midst of trying to work off some of the excess froth from that huge run higher. It makes perfect sense for gold to take a little bit of a breather at this point, as there has been so much in the way of chaos around the world that traders have jumped into this market impulsively. And now I think at this point in time, nobody really knows what to do.

There’s no real reason to sell gold, but I think ultimately, traders aren’t necessarily willing to just jump in and buy a hand over fist either. We are basically in the middle of what I see as a consolidation area between the $3,200 level on the bottom and the $3,500 level on the top. So, we’re basically at fair value. I really don’t see an opportunity here at the moment, although if I were forced to take a position, it would most certainly be to the upside.

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