Gold markets rallied during the trading session on Friday, as we continue to see a lot of drama involving the United States and China when it comes to the trade negotiations. The neckline above has offered resistance yet again, just as the 50 day EMA has. If we break above there, on a daily close specifically, then it’s likely that we could go higher, perhaps reaching towards the $1315 level.
Gold Analysis Video 13.05.19
The alternate scenario of course is that we roll over from here and go looking towards the 200 day EMA underneath, which is pictured in blue on the chart. After that, I think the $1268 level will offer the next target. A break down below there could send this market to fulfill the measurement of the head and shoulders, meaning that we could go as low as $1225. Obviously though, we have a lot of headline risk out there that could throw the market around violently.
Gold could be thought of as a potential hedge against risk, so be aware that the Gold markets are often volatile in situations like we have now. I think that as people are very skittish, it makes sense that the Gold markets may retain a little bit of a bid. The Chinese almost certainly will retaliate to tariffs, so things could get very noisy. If the US dollar strengthens, that’s typically bad for gold unless of course it is some type of run to the hills type of moment.
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This article was originally posted on FX Empire