(MENAFN- Daily Forex) gold markets initially tried to break above the $1800 level, but then got absolutely hammered during the trading session on Monday. We currently sit just above the 200-Day ema , and it does suggest that we have pulled back enough that people may be looking to pick up a little bit of value. Whether or not we have enough momentum to turn things around is a completely different question, especially as we have seen interest rates rise quite sharply during the trading session on Monday.
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Keep in mind that the market is going to be dealing with a lot of noise over the next several days, especially as the Federal Reserve has a rather important meeting coming up next week, and a lot of people will be paying close attention to the statement after the 50-basis point rate hike that should be coming. Ultimately, this is a market that I think continues to see a lot of noise, and it will go back and forth right along with the other markets, as we continue to see so much volatility and alignment of concern.Pay Close Attention to the Market
If we turn around a break above the top of the last couple of days, then we could go looking to the $1880 level. This would accompany interest rates falling, and therefore you need to pay close attention to the 10-year yield. Beyond that, you should also probably pay attention to the US dollar, but quite frankly it's likely to follow right along with those interest rates anyways. The size of the bar for the day is of course negative, and rather impressive. By losing 1.6% or so for the day, this is a shot across the bow by sellers, but the 200-Day EMA does attract a lot of attention. Because of this, I will be paying close attention to this market over the next couple of days because it could very well offer an interesting opportunity.
If we were to break down below the 50-Day EMA, then it's very likely that the gold market will get crushed over the longer term, with the idea of it going down to the $1640 level again. That obviously would need to see a huge amount of momentum in favor of the US dollar, which during the day on Monday at least, we have seen that return.
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