Gold markets have rallied significantly during the trading session on Thursday but hit a brick wall of resistance above the $1215 level, and I think that there are a couple of moving pieces right now that are throwing the markets around. The US economy printed a lower than anticipated CPI number, and that sent the greenback lower, and by extension sent the Gold markets higher. However, at the same time there is comments coming out of the European Union that further stimulus may be needed by the central bank, which is positive for the US dollar as the EUR/USD pair essentially drives the majority of US dollar flows.
Precious metals have had a couple of good days here, but I think we are starting to get a bit overextended so would not be surprising at all to see Gold turn around. At this point though, I think that the $1210 level will offer a bit of support. Alternately, if we can break above the $1220 level, then we probably go towards the $1225 level. I do believe that we probably see a pullback rather soon though, so I’m actually looking for a selling opportunity at this point. However, we don’t have that right now so I think that waiting for signs of exhaustion will be the best way to trade this market. Simply step out of the way and wait for a bit of a break down to start a small short position.
Price of Gold Video 14.09.18
This article was originally posted on FX Empire
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