Gold Technical Analysis
The gold market has gone back and forth during the course of the trading week as we continue to see a lot of choppiness and a lot of questions asked about what’s going on with the interest rate markets, the war in the Middle East, and just the US dollar in general. We have been trading between $4,000 on the bottom and $4,200 on the top, and with that being said, I think short-term traders are probably in charge. However, if we can break above the 50-week EMA, that would show a bit of momentum coming back into the market.
Rising Rates and Geopolitical Headlines Weigh on Long-Term Conviction
I personally like gold longer-term, but as long as interest rates continue to jump, it’s difficult for a non-yielding asset like gold to have any real traction over the longer term. With that being said, I think we have to watch interest rates, headlines coming out of the Middle East and the reaction on interest rates, the US dollar, and then price action on gold. It’s a very noisy and messy type of situation that we have here, and I don’t think that changes anytime soon. Because of this, it can be a waiting game for longer-term traders out there.
Now, if and when the world gets a break from the conflict in the Middle East, then we can see the true nature of gold. But as things stand right now, it looks like most traders just don’t really have a lot of conviction one way or the other.
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