Gold markets initially fell during the week, but then turned around to form a bit of a hammer.
Gold markets initially fell during the week but found enough support at the $1700 level to turn around and form a bit of a hammer. This has been an interesting couple of weeks for gold, as it simply consolidates in general. I think at this point it is likely that we will continue to see this market show a lot of noise, and therefore it is going to be difficult to simply jump in with a huge position. Having said that, you clearly cannot short gold at this point, there is a lot of the world out there looking to buy gold “on the cheap.”
Gold Price Predictions Video 01.06.20
At this point in time, the $1700 level looks to be crucial, just as the $1760 level is. If we can break above there, then it is likely would go looking towards the $1800 level. Breaking above there then opens up the possibility of a move to $2000, something that I do feel it is only a matter of time before we reach. After all, there is plenty of central bank printing, and it is likely that the gold markets respond due to the fact that fiat currencies are trying to be devalued. If that is going to be the case, then people will run towards precious metals.
Beyond all of that, there are a multitude of negative headlines out there that could cause issues, and that of course drive money into gold for safety. With this in mind, I fully anticipate that gold will continue to be one of the better performers for the rest of the year, therefore I like buying breakouts.
Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.