Comex Gold Futures (GC) Technical Analysis – October 28, 2016 Forecast

December Comex Gold futures are trading slightly lower shortly before the regular session opening. The market is forming a third consecutive inside move which suggests trader indecision and impending volatility. Essentially, the market is wound pretty tight, putting it in a position to breakout in either direction.

Volatility is likely to return with the release of the Advance GDP report at 1230 GMT. It is expected to show the economy grew 2.5% during the quarter. The previous number is expected to be revised upward to 1.4%.

Since there is a likely to be a revision, investors have to be prepared for a two-sided move following the release of today’s report.

Another reason to expect volatility and a two-sided range is the size of the range of estimates. Forecasts call for a range of 1.3% to 3.6%, making the report vulnerable to surprises.

Technical Analysis

The main trend up according to the daily swing chart. A trade through $1277.50 will signal a resumption of the uptrend. This could trigger an acceleration to the upside.

A trade through $1260.10 will turn the main trend to down. The next target under this price is the $1243.20 main bottom.

The short-term range is $1260.10 to $1277.50. Its 50% level or pivot is $1268.80. The market is currently straddling this level. It will determine the short-term direction.

The intermediate range is $1243.20 to $1277.50. Its 50% level or pivot is $1260.30. Breaking this level will put the market in a weak position.

The main range is $1347.80 to $1243.20. Its retracement zone at $1295.50 to $1307.80 is the primary upside target.

Forecast

Based on the current price at $1267.10 and the early price action, the direction of the market today is likely to be determined by trader reaction to the short-term pivot at $1268.80.

A sustained move over $1268.80 will indicate the presence of buyers. This could create enough upside momentum to challenge this week’s high at $1277.50. This is the trigger point for a surge into the next two targets at $1295.50 and $1295.80.

A sustained move under $1268.80 will signal the presence of sellers. The next target is a price cluster at $1260.30 to $1260.00. This is the trigger point for another sharp break into $1243.20.

If $1243.20 fails then look for another wave of selling pressure to drive the market into possibly $1229.60.