(MENAFN- Daily Forex)
Gold markets rallied rather significantly in the early hours on Wednesday, but as soon as futures traders came on, they got hammered again. So, at this point, I think we're just going to continue to try to grind higher, but it's not going to be very easy.
Ultimately, this is a market that I think, given enough time, probably breaks out above the shooting star from last week, and once it does, it really could start to take off. At that point, I would expect gold to go looking to the $2,500 level. The central banks around the world continue to buy gold . So that of course, provides a little bit of support. But at the same time, you also have to look at the fact that there are a lot of geopolitical concerns out there. In other words, a lot of people are going to need safety.
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Pullbacks at this point in time should continue to attract buyers, especially near the $2,150 level. And then again at the 50 day EMA. Central banks around the world cutting rates will also lead to upward pressure. So I think at this point, you have to look at gold as one of those assets that you want to own when it gets cheap.
I don't know when we break out to the upside, but it certainly looks like we are relentlessly trying to do so. And that's generally a good sign that it eventually happens. I think you have a situation here where the market continues to pull back occasionally and each one of those pullbacks will more likely than not attract a lot of value hunting . It has been noisy over the last couple of weeks, but if you look at the previous action, we went straight up in the air from about $2,050 to $2,200. So, a little bit of consolidation and grinding certainly would make a bit of sense. After all, we cannot go straight up in the air forever, and therefore some work will need to be put into this market currently.
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