Gold Forex Signal: Continues to Look Positive
Potential signal:
- I am a buyer of gold, right here, right now.
- I would have a stop loss at the $2475 and be aiming for a move to the $2,612 level.
Gold has pulled back just a bit during the trading session on Monday, only to turn around and show signs of life. By doing so, the market ends up forming a little bit of a hammer, but you need to keep in mind that Monday was Labor Day in the United States and Canada. So, with that being the situation, liquidity was a little bit of an issue. The $2,500 level is a situation where the market will be looking at this large round psychologically significant figure as an area where a lot of people have been paying close attention. If we rally from here, then the $2,525 level could be a bit of a target followed by a much bigger move. I do think that will happen eventually. Keep in mind, gold has a massive list of reasons to go higher.
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1There is much more to watch
But really, at this point in time, there's just a handful that I'm paying attention to. The first one, of course, is the idea that there are plenty of geopolitical tensions out there that could have people looking for help protecting their wealth. The gold market also could be lifted by the idea of interest rates dropping in central banks around the world.
With that being the case, the market will continue to favor gold. And in that environment, it also means that storing gold no longer becomes as much of an issue because you're not going to be able to buy a bond and simply collect interest. Furthermore, we also have central banks around the world buying gold hand over fist, large ones such as Russia, India, China are all buyers of gold, so that should put a little bit of a floor in this market. Regardless, I am a buyer of dips, and I do think that gold breaks out sooner rather than later.
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