- Gold is struggling a bit to continue the upward momentum that it started during the day here on Thursday as the $3,500 level still looms large.
- Ultimately, this is a market that I think given enough time may break above there, but we do have some issues when it comes to volume this time of year.
- After all, it is summer, and a lot of traders are more worried about vacation than whatever's going on in the markets, you can see that over the last couple of months, volume has started to drop.
Short-term pullbacks are very possible here, but I think they will be bought into maybe at the $3,400 level, probably at the 50-day EMA and more likely than not, the $3,300 level. If we break above the $3,500 level, the measured move of the range is $300 as the consolidation has been that much. So, when I look at this, I see this as a market that could go to $3,800.
Keep in mind that the traders out there are going to continue to see plenty of reasons to perhaps look for safety, not the least of which would be a little bit of indecision when it comes to central banks.
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The US dollar is at least trying to fight back. And that is a major contributor to where we might go as there's so much uncertainty, but with the us dollar, probably going to see a few rate cuts coming out of the central bank in America. That could be the catalyst. Furthermore, we have plenty of geopolitical issues.
We also have a lot of questions about loose monetary policy, not only from America, but other countries as well. We had been in a major uptrend before we got here, so it makes a little bit of sense that maybe we have to work off some of the excess froth. That's what we've done all summer. Typically speaking, consolidation leads to continuation.
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