Gold Forecast Today 27/5: Continued Upward Momentum (Video)

(MENAFN- Daily Forex)

• Gold rallied slightly during the trading session on Friday, but I think what's more important here is that it stabilized.
• We've had a couple of very brutal days in a row. So, for Friday to be slightly positive is a good sign.
• There is a lot of noise between here and the $2,300 level that I think a lot of people will be looking at as a potential support barrier that you need to pay attention to.
• With that being said, we need to hang on to the $2300 level to continue the upward momentum that we have seen for some time.

With that, I think you've got a scenario where traders continue to be attracted to dips as cheap gold as there are plenty of geopolitical concerns around the world that will continue to propel gold higher given enough time. The $2,300 level also features the 50-day EMA , which a lot of people will pay close attention to so it could end up being a bit of a floor in the market.

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We are overbought, but it doesn't necessarily mean that the trend is over.

We were overbought, but suddenly we find ourselves somewhat oversold. So, I think you are more likely than not going to see buyers coming back in, but keep in mind that Monday is Memorial Day in the United States, and therefore it will affect liquidity quite drastically.

A break above here could open up a move to the $2,400 level, which then opens up the possibility of a move to the $2,500 level. If we were to break down below the 50 day EMA, then it's possible that we could go looking to the $2,200 level, but right now, I'm not holding my breath for that move because geopolitics, the massive amount of borrowing that countries around the world are doing, and instability overall continues to make gold an interesting asset to own . Ultimately, I have no interest in shorting gold and probably won't do so anytime soon. I believe that you should always own a little bit of it, but these days it probably pays to own even more than the usual allocation.

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