Gold Markets Weekly Technical Analysis
The gold market has been above $5,000 and tested $4,400 in the same week. All things being equal, this is a market that I think continues to see a lot of choppiness and a lot of questions asked about the crucial $5,000 level, as it will be a headline grabbing event.
The $5,000 level is a large, round, psychologically significant figure and an area that I think a lot of people will be watching very closely due to the idea that it brings in so much attention. At this point in time, we’re probably at best going to see a lot of sideways action.
Technical Balance and Market Structure
It is worth noting that the previous week before was a shooting star-like candle and the weekly candlestick, at least as things look right now midday on Friday, could be a hammer. When you see opposing candlesticks like that, that tells you are getting fairly close to finding some type of balance or sideways action.
I think the sideways action is likely to continue to see a lot of questions asked about the trend. I do think short-term back and forth range-bound trading might be what we are looking at.
But if we can get a daily close above $5,000 or better yet, a weekly close, then I think the uptrend continues. Quite frankly, several weeks of sideways action are exactly what this market needs in order to find some trend going forward.