I think this is a market that has some work to do before it makes its intentions known.
The gold market fluctuated during the trading session on Monday as we continue to see the 200-day EMA attract a lot of attention, but it is worth noting that we simply have nowhere to be from what I can tell. Looking at this chart, it is obvious that the market has been stuck in a range for a while, so I think you need to pay close attention to the $1790 level underneath which is support, right along with the $1830 level offering significant resistance. As long as that is going to be the case, then I think you have to look at the market through the prism of short-term trading at best. Ultimately, this market will probably allow you the opportunity to go back and forth on short-term time frames until we get some type of clarity.
That clarity could be coming at the end of the week with the jobs report, but right now gold continues to see very little in the way of follow-through on moves, so I believe it is probably only a matter of time before we have to make a more impulsive candlestick that we can follow. The impulsive candlestick is something that we will have to wait for, because that is what I thought the Thursday candlestick was going to be. Considering that we wiped out all of the gains from the Thursday candlestick rather rapidly on Friday, it still shows that we have nothing but confusion here.
To the downside, if we were to break down below the $1790 level, then we could go looking towards the $1750 level. That is an area that has caused a major bounce, and I think it will be very important from the longer-term standpoint. Breaking down below that level then opens up the possibility of a move down to the $1680 level, which is where we have the massive double bottom. On the other hand, if we do break out above the $1830 level, then it is likely we will go looking to fill the gap above, which is something that happens most of the time in the futures markets. Ultimately, I think this is a market that has some work to do before it makes its intentions known.