We’ll markets initially fell during the week but found enough support near the $1215 level to turn around and form a candle that could be loosely translated as a hammer. That’s a good sign, and quite frankly the gold market is oversold so it would not surprise me at all to see a bit of a bounce. Beyond that, the US dollar has been a bit overbought, so we could have a bit of a “double whammy” coming. However, I think there’s even more significant demand closer to the $1200 level, so it makes sense to think that perhaps we could drift a little bit lower before seeing a true surge higher.
A break down below the $1200 level would be significant indeed, opening the door to the $1120 level for buyers to try to protect. Most of the move in this market is going to come down to what’s going on with the US dollar, which continues to strengthen. It’s not until other central banks around the world get their act together that we are going to see a longer-term move. However, there is one hell of an investment opportunity coming as gold will eventually turn around and go much higher. I believe that the “smart money” is starting to accumulate physical gold, and that the $1200 level should offer a bit of a “floor” in the market.
Gold Technical Analysis Video 23.07.18
This article was originally posted on FX Empire
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