Gold Price Forecast – Gold Continues to Look For Buyers Ahead of FOMC

Gold Markets Technical Analysis

The gold market bounced a bit during the early hours on Wednesday as the FOMC looms large. The FOMC meeting could of course have a major influence on where we go next but at this point, I think you’ve got a situation where traders are somewhat concerned about what Jerome Powell may say and probably with good reason – quite frankly because if he does end up being very hawkish this could be a situation where Gold truly plunges down to the 50-day EMA maybe even down to the $2,200 level. All things being equal, I think this is a situation where traders come in and pick up value.

However, if we can take out the top of the candlestick during the Tuesday session, then gold should go looking to the $2400 level. In general, this is a market that I’m bullish on, but I also recognize that you have to keep in mind that we were a little overdone to the upside for a while and therefore, I think ultimately this is a market that does go higher, but the question is will it pull back fifty dollars in the process?

That’s the part I would be concerned about. I would keep my position size reasonable because obviously there will be a lot of noise around that FOMC press conference. Expect a lot of nonsense in the meantime, but in the end, we will more likely than not see a continuation eventually. That is the key though, eventually. I think a correction has been needed for some time, and the FOMC announcement has been the perfect excuse to make it happen.

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