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Gold markets initially fell during the session on Wednesday, reaching down towards the $1305 level before turning around to show signs of strength again. We have rallied to the $1317 level again, and then started to fall. We have been consolidating in a relatively tight range for some time, at least over the last several sessions. I think that the market is trying to figure out what to do with the US dollar, geopolitical events, and many other issues. I recognize the $1300 level underneath being major support, and a breakdown below that level could unwind this market rather rapidly. However, I think at this point there is a lot of confusion and concern in the market, and that tends to lead to choppy in sideways trading as we have seen.
If we can break above the $1320 level, then I think gold markets rally rather significantly, perhaps to the $1350 level. Alternately, if we break down below the $1300 level, the market probably unwinds down to the $1275 level underneath as it is a previous support and resistance level. This is a market that has been very choppy, and quite frankly I don’t think it’s going to change anytime soon. I believe that range bound trading might be a great way to play this market, and as you can see I have the Bollinger Bands indicator on the chart, showing signs of both overbought and oversold conditions. I think that back and forth trading continues to be the best way to trade this market until we break through one of the levels that I mentioned earlier.
Gold Price Forecast Video 10.05.18
This article was originally posted on FX Empire