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MENAFN- Daily Forex)
- Gold initially tried to rally during the trading session on Friday but gave back gains as we continue to see a lot of volatility.
- This is a market that I think will continue to be very choppy.
- I do think that eventually there will be buyers on short-term pullbacks.
The $2,500 level seems to be a large round psychologically significant figure that a lot of people will be paying attention to. And even if we do break down below there, the $2,480 level offers support, and then again, the $2,400 level, all things being equal, this is a market that looks very bullish. And I think ultimately this is a situation where we would see a lot of value hunters coming in. The gold market gets a bit of a boost due to geopolitics.
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The fact that central banks around the world are buying it. The Russians, Chinese, and Indians are all buying it. I suspect several other banks as well. Lower interest rates around the world will also make gold a little bit more appealing and therefore it all ties together for a gold market that will almost certainly try to go higher over the longer term. I have no interest in trying to get short of this market Trend is Too Strong to Short
It is far too strong, and I don't really see too many scenarios where gold should fall. With that being the case, I like the idea of finding value, but I also recognize that we have a scenario where people are going to have to be very patient to get cheap gold. Keep in mind Monday is Labor Day in the United States and therefore the futures markets will be closed during the normal business hours, and that will have a major influence on liquidity.
With all of this, I think you have a lot of time to get involved over the next few days, and at this juncture, I think pullbacks are more likely than not going to be thought of as opportunities going forward. This is a situation where the longer-term trend remains intact.
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