Is Gold about to run back up?
Gold had a strong session on Friday, following the hammer formation that we saw on Thursday on the daily chart, with the market closing above 1570. At 1.578 at the time of writing, the precious metal kick started the week on a negative footing. Last week´s price movement reinforces the idea that the 1550 area is a massive support area. The gold market has been in a downtrend since October 2012, but as long as we remain above the psychologically important 1550 level, there is still plenty of upside potential. Key levels for the bulls to watch in the long-term sit at 1.617 and 1.667. A break above that would open the door for the 1.750 area. In the alternative scenario, we would have to see a consistent break below 1550 in order to give up gold’s bullish outlook, but with central banks all over the world printing their way out of financial trouble, this is hard to imagine.
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