Gold Price Outlook – Gold Sits Still in Early Friday Trading

Gold Technical Analysis

Gold has found itself to be a little bit neutral during the trading session here on Friday, but really at this point in time, we’re just hanging around. I think we are going to either have a situation where we pull back towards $3,500 and then bounce, or maybe we just go sideways. Both of these serve the purpose of working off excess froth.

Excess froth, of course, comes into the picture when you get a huge move higher, and then everybody’s on the right side of the trade, so there’s nobody left to sell. And we may find ourselves in that scenario, at least in the short term. So, you can either work it off via time, people just learn to accept that gold is $3,700 an ounce, or you pull back in order to offer value for new buyers to get involved.

Looking at the ascending triangle, the measured move is for $3,800. The $3,800 level hasn’t been touched yet. So, I do think there is still the possibility of getting there. I just don’t know if it happens right away. I certainly don’t want to short gold. Gold is very strong and therein lies the problem because of the momentum.

Central banks out there buying gold and of course it looks like the Federal Reserve and other central banks might be cutting rates. And therefore, it typically drives up the price of hard assets such as gold. Either way, either we get a dip, or we go sideways for a while, but I’m looking forward to buying again. I would love to buy anywhere near $3,500, but that’s going to take a pretty significant pullback.

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