Gold Headed To $1,280
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Monday was April Fool’s Day and apparently there was some “fool’s gold” as the yellow metal tried to rally early before selling off most of the day. Gold appears to have found new resistance at $1,300 as it churns on both sides of it, only to stay below that level.
Since reaching our initial target of $1,350, gold has been under immense pressure and seems to be headed to $1,280, which will be another key battleground. Obviously, there is no way to know when the $1,280 level will be reached; however, we expect sooner rather than later.
For now, the yellow metal has lost its desire to go higher and the path of least resistance seems to be down. This does not change our outlook for higher prices in time but for now the strong hands are the sellers. We will be looking for a test of $1,280, watching the reaction at this level before making our next move. We are bullish over the next 12 months, neutral over the next six and bearish now.
Depending on how gold trades, our current and six-month views can change but for now the trade appears to be sell rallies until gold breaks out over $1,320. Markets change, patterns change, so be flexible and let the markets tell you what’s next.