Gold Price Outlook – Gold Continues to Stagnate

Gold Markets Technical Analysis

Gold has been very quiet in early trading on Tuesday, the gold market of course has been fairly quiet in early trading on Tuesday, as you would expect it’s Christmas Eve. But really, at this point in time, you’ve got a situation where the market is fighting interest rates, because despite the fact that the Federal Reserve is cutting rates in America, the bond market doesn’t care.

And with that being the case, I think you’ve got to look at this through the prism of whether or not rates continue to climb because if they do, that will eventually break gold down. On the other hand, if the market sees the rates drop in America, that could help. Remember, the Fed cutting rates doesn’t really change the 10-year. They don’t deal with that part of the curve. The 10-year hit 4.6% during the previous session.

And that is a bit of a problem because higher yields makes owning bonds much more attractive than owning gold sooner or later. So with all of this, I think we’re going to see a big push and pull situation, but it is worth noting that we’ve been in an uptrend for some time. While trends do end eventually, the reality is it’s easier for a trend to continue. If we can take out the 50-day EMA above, then the $2,700 level probably gets challenged.

If we break down below the $2,550 level, then I think we go looking to the $2,500 level, which is right around the 200-day EMA. In general, I like gold. I think the geopolitical situation calls for it as well, but the interest rate markets are going to have to calm down for gold to truly take off to the upside.

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