• Looking at the gold market, my daily analysis suggests that gold will eventually go higher as we have gone back and forth over the last couple of days.
  • We had initially shot higher during the trading session on Tuesday, but Wednesday seems to be a bit more of a mixed bag as we have pulled back.
  • Keep in mind that later in the day we get the FOMC Meeting Minutes, and that has a major influence on what people think the Federal Reserve will do, and therefore will have a major influence on what happens next with the US dollar, and therefore it will have a major influence on what happens next with gold itself.

Gold Forecast Today 22/8: Sees Sideways Support (graph)

A Plethora of Reasons for Gold

There are plethora reasons to think that gold will continue to offer value, not the least of which is the fact that the geopolitics of the world right now are an absolute mess. With that being the case, I think it’s a situation where traders will have to pay close attention to the headlines, but right now there’s not a lot out there to make me think that suddenly markets are going to be calm, and geopolitics won’t continue to be agitated at the very least.

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Furthermore, you also have to pay close attention to the idea that the interest rates around the world are dropping, and that does make a certain amount of sense that people would run the gold, because bonds are not going to be offering the rates that we had previously seen, so therefore the idea of paying to store gold is not as crazy of an idea as some people might think. After that, you also have to keep in mind that there is a lot of volatility out there in other markets, and of course central banks around the world continue to buy gold, which is a very positive thing as well.

If we do break down from here, there should be plenty of support near the $2400 level, which is right around the 50 day EMA as well. Furthermore, the uptrend line comes into play right in that same area as well. In other words, I think any time we sell off, there’s probably somewhat of a limited scope of ground that we can cover in that direction.

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