Gold markets have been very choppy during trading on Monday, as traders came back from the weekend. Stock markets in general continue to struggle, and I believe that will be an issue in the short term, as there are a lot of protectionist concerns around the world. Ultimately, this is a market that looks very bullish to me longer-term though, and gold does tend to perform a bit better in a nervous environment as people tend to use it as a safe haven. I believe that market participants of the value mindset will continue to look at the area we are in as a potential value play.
Because of this, I’m looking to buy gold, but I’m not looking for some type of massive rally. Instead of that, I anticipate that we will more than likely see a lot of choppy action, perhaps arise towards the $1325 level, followed by $1340. I still believe that the $1300 level acts as significant support and should continue to do so going forward. The market certainly seems to attract a lot of buying in this region, and I think that will continue to be the way this market plays out longer term. If we can ever break above the $1400 level, I would be more than willing to hang onto a trade for the long term, and of course as most traders do, I buy physical gold. If we were to break down below $1300, the next level of support I see is $1275.