Comex Gold Futures (GC) Technical Analysis – August 25, 2016 Forecast

December Comex Gold futures retreated to a four-week low early Thursday before stabilizing and rebounding slightly. For the most part, however, prices remained rangebound ahead of a speech by Federal Reserve Chair Janet Yellen on Friday which will be watch closely by investors for clues on monetary policy.

Bullish gold investors are hoping Yellen signals that a rate hike is not imminent. The bears want her to signal a rate hike between September and December. Currently, investors have pegged the chances of a September rate hike at 18%, a December rate hike at 24% and September 2017 rate hike at 100%.

Technically, the main trend is down. The trend turned down on Wednesday when the market took out $1335.30. The next target on the swing chart is the July 21 main bottom at $1318.50. The trend will turn higher on a trade through $1364.30.

The main range is $1207.00 to $1384.40. Its retracement zone at $1295.70 to $1274.80 is the primary downside target if this current break gains traction.

Based on the early price action, the direction of gold prices today should be determined by trader reaction to the long-term uptrending angle at $1329.00.

A sustained move under $1329.00 will indicate the presence of sellers. The daily chart is open to the downside under this angle with the next target coming in at $1318.50. This is followed by another uptrending angle at $1302.10.

Crossing to the strong side of the uptrending angle at $1329.00 will signal the presence of buyers. However, gains are likely to be limited because of a downtrending angle at $1340.20.

Watch the price action and read the order flow at $1329.00 today. Trader reaction to this angle will tell us if the bulls or the bears are in control.