Weekly Gold Forecast: Ready to Test Big Figure Again

Christopher Lewis

The gold markets initially tried to rally during the trading session on Friday but then pulled back from the triangle that I have drawn on the chart to reach towards the $1700 level. I believe that there is significant support underneath that should continue to turn things back around. The $1695 level should be a significant level. The uptrend line of course does offer support, and of course the 50 day EMA is underneath which should offer significant support. At this point in time, I believe in gold, although Wall Street was a big seller late in the day as “everything is awesome” yet again.

If we can break above the highs from the trading session on Friday, then it is possible that we go looking towards the $1750 level, and then possibly the $1800 level further. To the downside, I would be more than willing to be a buyer underneath the $1700 level and then slowly add as the market works out in my favor. After all, the gold markets are being supported by a multitude of reasons.

The first reason of course is the fact that the central banks around the world continue to flood the markets with liquidity, and therefore hard money will be something that a lot of traders look towards. The natural trade is to buy gold, and that is part of what has been driving this. Furthermore, you can see that the triangle forming is a bit of digestion for the biggest move to the upside. After that, you can also make the argument that we are simply waiting for further bad news, which will more than likely drive the safety trade forward, sending this market much higher.

Advertisement
Afraid of market volatility? Gold is a great safe haven asset

  Trade Gold Now!

At this point, I do not really have a scenario in which I am willing to sell gold but would start to rethink things if we were to get below the $1600 level. That is $100 away right now, so I am looking for an opportunity to buy the market “on the cheap.” With all of the cheap money that has been thrown in the market, I do believe that eventually gold markets will take off and we could be at the very beginnings of a longer-term bull market. Buying on the dips has worked for several months, and I do not see that changing anytime soon. Simply adding to trades that work out in your favor will be the best way going forward.

Gold

About the Author
Christopher Lewis

Christopher Lewis has been trading Forex for several years. He writes about Forex for many online publications, including his own site, aptly named The Trader Guy.

Currency Pairs:
Comments

Did you have a good experience with this broker? A bad one? Tell our team and traders worldwide about your experience in our User Reviews tab. Your email address will not be posted.

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

0 User comments
Add Comment

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

Read more
Add new comment
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.