Gold is oversold and at support. That means it may be time to buy the commodity. The downtrend that started in March may be over.
The term "oversold" refers to a security’s momentum. This is a measure of how far it has moved in a given time. If it gets sold aggressively and pushed below its typical range, traders say it’s oversold.
This is important because markets that are oversold tend to reverse and rebound.
Support is a large concentration of investors who are looking to buy close to the same price. There is so much demand at support levels that when selloffs reach them, they tend to pause or even end.
As you can see on the following chart, gold may have found support again around the $1,725 per ounce level. It’s also oversold.
The stage may be set for a move higher.
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