- Gold markets initially pulled back just a bit during the trading session on Tuesday, but then turned around to show signs of life as we continue to see a lot of volatility and concerns in financial markets around the world.
- It is probably worth noting that this is a market that I think will continue to see more of a buy on the dip behavior, and with this, when you look at the markets, you can make an argument that perhaps we are in the midst of testing the top of a bullish flag.
- And with that being said, breakout from here, of course, could send this market much higher.
Market participants are clear that it’s a bullish market and the 50-day EMA is at a perfect 45 degree angle, so that bodes well also.
Because of all of this, if we do break out to the upside at roughly $2,690, I think that could potentially confirm the bullish flag being broken out, and it opens up a move to roughly the $2,800 level, which I think is a very reasonable target considering everything that we have seen over the last year or so.
it is worth noting that there is no end to the reasons that could continue to cause volatility and demand in the gold market.
If We Do Breakdown
If we do break down below the $2,600 level, then you have the 50-day EMA coming into the picture, offering technical support.
It is really not until we break down below there that I think you are even starting to think about a significant pullback, and quite frankly, with all of the geopolitical concerns out there, interest rates being cut, and a whole host of other concerns, I think it makes a lot of sense.
The gold continues to go higher over the longer term and therefore I do buy this every time it dips. Another thing that is worth noting is that there are several central banks around the world jumping into the gold market as well.
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