Gold markets initially fell during the trading session on Tuesday but found enough support just above the $1600 level to turn things around and form a bit of a hammer. The hammer of course is a bullish sign and if we can break above the $1650 level, we should see a nice move towards the $1700 level. Ultimately, this is a market that I believe continues to see a lot of support building, and that means we may get the occasional pullback. Those pullbacks should be thought of as buying opportunities though, because there are plenty of reasons that believe that there will be a drive into precious metals over the longer term.
Gold Price Predictions Video 01.04.20
Looking at this chart, if we were to break down below the 50 day EMA, then the market probably drops down towards the $1500 level. I think at this point the longer-term “buy-and-hold” crowd would get involved and start buying for longer-term investments. I think overall, the market is bullish, but you need to be cautious about how much leverage to use. If we can break above the $1700 level, it’s likely that the market then goes towards the $1800 level, perhaps even the $2000 level. Ultimately, this is a market that also looks as if it is trying to form some type of bullish pennant as well, so that is also reason enough to think that we go higher. All things being equal, with central bank easing around the world it makes quite a bit of sense that precious metals continue to get a bit of a bid.
This article was originally posted on FX Empire
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