By FXEmpire.com
The gold markets rose for the session on Thursday as a couple of members of the Federal Reserve suggested that low rates are here to stay. This of course gets a run to the gold markets as the cost of carry and threat of inflation will drive the price of gold higher. The downtrend line that had been keeping the market down has been broken, and this should begin the leg up in the gold markets.
The gold markets have continued to show strength over the last decade, and there is absolutely nothing to suggest that the demand for gold is going to fall in the near future as we have several central banks looking to ease monetary policy for the foreseeable future, and we now live in a world of currency markets trading on the “lesser of two evils” for the most part.
The demand for gold will always suffer short-term shocks as the “hot money” flows in and out of the markets, but it cannot be missed that if you bought gold ten years ago – you have made an absolute fortune in this market. For that matter, three years ago would have worked out quite well too!
The longer-term investor has been right for years now, knowing that bowing out to the latest micro movement in this market is a sure recipe for disaster, and it is with that knowledge that we look at this market. We have never advocated selling gold here at FXEmpire, rather have only offered two ideas: flat or long. This shall continue to be the case for the foreseeable future, as our trading ideas now only come down to the timing of the trade, not the direction.
There have been many people calling for the destruction of the long-term bull trend in this market, but they have found nothing but large losses on the margin. With this in mind, we truly believe that the breaking of the highs from Thursday simply sends this market back up yet again as the longer-term trader has been saying for years now.
Gold Forecast April 13, 2012, Technical Analysis
Originally posted here
