Ultimately, the smartest traders are looking for an opportunity to find value in a market that is obviously very bullish.
Gold markets went straight up in the air over the last couple of weeks as the Russians continue to invade Ukraine. The geopolitical uncertainty will continue to cause gold to be sought out as a safe haven. After all, there are a lot of nervous people out there willing to buy gold regardless of how stretched we have gotten. I think at this point it has become obvious that gold is going to try to make a move towards the $2000 level.
Underneath, I see the $1920 level as a significant amount of support, and that is assuming that the market could even pull back that much. Ultimately, the market will continue to see a lot of volatility, but I think that every time it pulls back there will be more than enough people willing to jump in and lift this market.
Keep in mind that the market will continue to see a lot of people who are trying to chase this trade who perhaps even missed out. With interest rates rising around the world and, more importantly, inflation rising, gold will go much higher over the long term in that scenario. Add in war and the fact that there is a lot of concern about the lack of growth around the world, gold makes a lot of sense.
All of this being said, we do need to pull back occasionally in order to offer value, so I do think that you will get the opportunity to buy gold at cheaper levels. Chasing this market all the way up here is going to be a great way to lose money because you could be left “holding the bag.” Ultimately, the smartest traders are looking for an opportunity to find value in a market that is obviously very bullish. That is the epitome of a nice uptrend, and I do think that it will continue to go much higher. Do not get me wrong, gold does tend to be very volatile, so I think you will get your opportunity. Furthermore, I would not open up a huge position in this market in order to try to make a ton of money in one shot. While it could happen, the reality is that we are headline-driven at the moment, and therefore very nervous.