Gold Market Technical Analysis

As it appears that we are attempting to surpass the $1800 level, gold markets have displayed a slight amount of strength during Thursday's trading session. At this point, the market is more likely than not going to continue to dance along this rising wedge, which could present a little bit of difficulties. As you can see, there are several factors working against the market at the moment. The market is currently testing a previous resistance barrier that I have outlined in purple.

However, interest rates continue to decline in America and that could continue to propel this market upward. It's possible that we could reach the $1875 level if we can break through the $1825 barrier.

Under normal circumstances, the 200-Day EMA below at the $1768 level could be a significant support level. If we break down below there, then I think a lot of things change, because not only did we are down below the 200-Day EMA, but a huge gap that had created previously. It is evident that breaking that threshold would be disastrous.

The Federal Reserve meeting next week and, perhaps more importantly, the press conference that will follow the anticipated 50 basis point rate hike will be closely watched by many traders as the price of gold fluctuates significantly. With all that being stated, I would anticipate a lot of noisy behavior, but you should definitely maintain your position size reasonably moderate in the meantime. It certainly looks as though we are trying to break out to the upside, but we have a lot of work to do before that happens.