Gold markets rallied a bit during the trading session on Monday, reaching towards the $1425 level. However, we have found that area to be a bit resistive, so I think at this point we may continue to go back and forth in a $25 range as obviously the $1400 level underneath will attract a lot of attention. Ultimately, this is a market that I think will continue to offer a lot of back-and-forth trading, as we are trying to figure out whether or not the Federal Reserve is going to cut interest rates by 25 basis points, or perhaps 50 basis points.
Gold Analysis Video 16.07.19
Ultimately, I do think that we grind higher but there is a gap below that I’m paying attention to and I think that the absolute “floor” in the market is at the $1350 level. It’s not only where the 50 day EMA is roughly, but also the 50% Fibonacci retracement level from below. Overall, the market looks likely to reach towards the $1450 level above which is the absolute resistance barrier. A break above there probably sends this market towards the $1500 level after that.
Pay attention to the strength or weakness of the US dollar, because typically it will move counter to this market and I think we are entering that phase of trading yet again as we are paying attention to the Federal Reserve, so therefore I think that we will eventually see US dollar weakness and that of course helps. Ultimately, this is a market that I do think breaks out that we are trying to digest the major gains that we have had as of late.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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