Gold markets initially tried to rally during the course of the week but continue to see trouble at the $2000 level, which of course is a large, round, psychologically significant figure. If we were to break above that level, it would obviously be very bullish, but at this point I do not think that happens anytime soon. The market breaking above there obviously has gold looking for the $2100 level, but it is going to take some type of shock to the system to get gold flying like that.
Gold Price Predictions Video 07.09.20
The US dollar has been strengthening, and as the employment numbers in the United States came out a little better than anticipated, we could start to see a little bit of a reversal in the fortunes of the greenback, at least on a temporary basis. If that is going to be the case, then gold will certainly selloff. Underneath the current trading area though, I think that the $1800 level is an extraordinarily supportive area, and I would become aggressively long of this market. If we were to break down significantly below there, then the uptrend is over, and the US dollar skyrockets again. While it does sound a little drastic, that is essentially how this market is behaving these days.
As central banks around the world continue to buy gold, so I do think that longer-term goes higher but we have clearly gotten a bit ahead of ourselves as of late. The markets are trying to tell us this, so if we are a longer-term trader, we know that we have an opportunity to pick up gold “on the cheap” if it does drop.
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