Gold Price Outlook – Gold Grinds Higher Early on Tuesday

Gold Technical Analysis

The gold market has shown itself to be a little bit more bullish in the early hours here on Tuesday, although not as momentum driven as Monday. The question now is, can we continue to go higher? It does look like there is an area right around $4,150 that extends to the $4,200 level that I think will be defended. We’ll have to wait and see whether or not we can get above that area. I suspect, based on the price action so far during the day, it’s probably going to lead to a bit of a pullback.

The question at this point in time is whether we are forming the classic parabolic move to the upside, followed by a sell-off with distribution due to the massive amount of volume, a secondary attempt to break higher, and then failure. If we do, in fact, get that, it’s a good sign that maybe the bullish run for gold is over. On the other hand, once we get past the $4,200 level, then we start to talk about another leg higher.

Fundamentally speaking, gold is still being accumulated by central banks, but that’s been the case for a couple of years, so I don’t think that’s a major driver right now—although it certainly helps. The Federal Reserve isn’t as likely to be aggressive with its cuts as once thought, so maybe that’s part of what’s come into the picture, or it may have just been a market that got too far ahead of itself. Again, I’d watch $4,200. If we fall from here, the $4,000 region needs to hold. Anything below the 50-day EMA gets bearish quickly.

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