Comex Gold Futures (GC) Technical Analysis – May 24, 2016 Forecast

August Comex Gold futures are under pressure today. A stronger dollar and firmer equity prices are behind the selling pressure.

Technically, the main trend is down according to the daily swing chart. The market is in no position to change the trend to up, but we could see a reversal bottom if the selling pressure dries up and shorts decide to cover.

The short-term range is 1211.80 to 1308.00. Its retracement zone is $1259.90 to $1248.50. After consolidating inside this zone for three days, sellers are attempting to take out the lower or Fibonacci level at $1248.50. This is a sign of weakness.

The main range is $1049.40 to $1308.00. Its retracement zone at $1178.70 to $1148.20 is the primary downside target.

Based on yesterday’s close at $1254.90 and the current price action, the direction of the market today is likely to be determined by trader reaction to the Fib level at $1248.50.

A sustained move under $1248.50 will indicate the presence of sellers. The first downside target is a steep downtrending angle at $1244.00. Crossing to the weak side of this angle will put the market in an extremely bearish position.

A sustained move under $1244.00 will indicate that the selling pressure is increasing. This could trigger a steep break into the April 14 main bottom at $1227.50.

Regaining $1248.60 will indicate short-covering or profit-taking. If the volume is better-than-average on the move then look for upside momentum to take the market back to the 50% level at $1259.90. This is a trigger point for a strong rally into $1263.40 and $1276.00.

Look to trade the short side today as long as the market remains below $1248.60. Watch for the selling pressure to increase if the market falls below the downtrending angle at $1244.00. If selling volume increases on the move then look out below.