Investors who favor certain brands, investments or commodities often hate to see price consolidations. After all, that can mean that an investment is losing money. For those who invest on a short-term basis, trading multiple times during a week or even in a day, price consolidation is nothing to fear.
Whether gold prices are trending up or trending down, savvy investors who watch for regular price changes can still profit. With each fluctuation in price, the potential exists to make a smart trade. Using a more macro approach to gold price analysis right now hints at continued consolidation. Some analysts are predicting that gold prices will drop below the $1,200 per Troy ounce mark. As of early trading on Tuesday, July 11, 2017, gold futures for August delivery were trading at roughly $1,211.
Global Economic Factors Lead to Price Consolidation
There are a number of conditions that have contributed to the current price consolidation seen in the world of gold trading. One major component is economic optimism in the United States. A recent jobs report indicates that there were 222,000 jobs added to the economy in June. That report shows much greater growth than anticipated, which gives investors a sense of hope. Analysts still believe there could be enough support for gold prices to recover.
Others aren’t as optimistic about the short term potential for gold. They see the jobs report as an indicator of an economic upswing that could impact stock prices. Combine that with expectations that the Federal Reserve will increase the prime rate again later this year, and you have a recipe for a strong domestic economic outlook and improved performance of the U.S. dollar. When the dollar is strong, yields on commodities can dip, leading investors to more lucrative options.
Profit Potential Remains for Market-Wise Investors
Just because gold prices are currently consolidating doesn’t mean it’s a bad time to try your hand at gold trading. In fact, with prices lower than they have been in months, you can control more gold now than you could have only a few weeks ago. Trading gold futures online via a Forex platform can allow you to conveniently and simply trade gold from the comfort of your home or office.
