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Gold Continues to See $2400 as Trouble
By: Christopher Lewis | May 16, 2024

• The gold market continues to see the $2400 level as a major barrier to continuing the gains in this market. However, it is most certainly a market that can’t be shorted, and at this point, should be a “buy on the dips” scenario.

Gold Markets Technical Analysis

The gold market rallied a bit during the trading session on Thursday to hit the $2,400 level. The $2,400 level is an area that previously has seen a pretty significant barrier. The $2,400 level being broken to the upside opens up the possibility of the market going to the $2,500 level, perhaps even higher than that.

At this point though, it would not surprise me at all to see a little bit of a pullback, mainly due to the fact that we have gotten a little stretched. A pullback could look like the gold market dropping all the way down to the $2,300 level, which is the bottom of the most recent pullback. We also have the 50-day EMA hanging around in the same area, and therefore I think it is more or less a hard floor at the moment.

Short-term pullbacks will more likely than not be a scenario where we can get a little bit of a buy on the dip mentality of most traders around the world. Keep in mind that the gold market is being stepped into by central banks as they’ve been accumulating for some time. The gold market is also highly sensitive to the interest rate situation around the world. So, pay attention to that. And at this point in time, it just looks like we are continuing the overall upward pressure, but I don’t necessarily want to chase right into this resistance.

If we get a daily close that is significantly above $2,400, then fine, I will jump in, but I think you probably get a little bit of a pullback here to offer some value, especially as may wish to take their profit later on on Thursday and into early Friday, we’ll just have to wait and see. Either way, selling gold isn’t even a thought.

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