- The gold market initially fell during the trading session but then turned around to show signs of life again as it looks like we are, in fact, trying to stay somewhat stable.
- At this point, I’m very interested in the $4,400 level because, quite frankly, I think if we can get above there on a daily close, you would have to look at this as a market that might just end up being interestingly bullish and could go looking toward the high again.
- With that being said, I am somewhat cautious, but I recognize that the longer-term outlook for gold is strong as central banks around the world continue to buy it, and of course, you also have the Federal Reserve cutting rates in 2026.
Market Outlook and Technical Indicators
We have pulled back into this nice ascending triangle that previously had been so important, and now it looks as if a measured move to the upside suggests that gold could go looking to the $4,900 level.
The 50-day EMA sits right around the $4,200 level, and I think that offers a bit of a short-term floor. Anything below there then opens up the possibility of $4,000 being challenged, but I just don’t see that happening. This would be a major turning point in the market if it did, in fact, happen.
The way that we have turned around to show signs of life suggests that we are, in fact, starting to stabilize a bit, and now we’re just waiting to see the buyers come back. I have no interest in shorting gold, and I do think that it continues to grind higher as we go into 2026. Ultimately, I think this is a market that goes much higher, but you must be careful with your position size this time of year, and in these volatile times.
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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.
