Gold Technical Analysis
The gold market has pulled back a bit during the early hours on Tuesday, as we have seen quite a bit of profit taking. All things being equal, this is a market that I believe will continue to see buyers due to the larger candlestick on Monday, which did have a significant amount of volume on a breakout. The market has been grinding higher for what seems like a lifetime and therefore I do think it’s probably only a matter of time before we see gold not only look at the all-time highs at $3,500 but break above there. That doesn’t mean that it’ll be easy. And it doesn’t necessarily mean that it’ll happen right away. But I do think the dips in the gold market continue to get bought into as they offer value in an environment that has been very bullish for some time now.
On a move above $3,500, I’m not really sure where we will go. Based on the measured move, you would be looking at $3,800. And while that sounds somewhat crazy. The reality is it wasn’t that long ago that $3,000 sounded crazy. So, gold will continue to strengthen as the world continues to see a lot of volatility overall. And of course, central banks out there continue to hoard gold anyway. So, with this, I like the idea of buying dips. I do think we get to the $3,500 level probably sooner than most people think and eventually break through it. I have no interest whatsoever in shorting.
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