Comex Gold Futures (GC) Technical Analysis – August 15, 2014 Forecast

December Comex Gold futures continued to consolidate inside the retracement zone bounded by $1314.30 to $1322.10. This chart pattern typically indicates impending volatility.

The daily chart indicates there is plenty of room to move in either direction.

An angle moving down $1.00 per day from the $1347.50 top drops in at $1321.50. An angle rising $4.00 per day comes in at $1321.50. These angles combine with the Fibonacci level at $1322.10 to form a major resistance cluster.

A failure to overtake $1322.10 will indicate sellers are defending the upside. The next target will be the 50% level at $1314.20. Taking out this level with conviction could trigger a break into the retracement zone formed by the $1281.00 to $1324.30 range. The retracement zone at $1302.60 to $1297.50 is the next likely downside target.

An uptrending angle from the $1281.00 bottom comes in at $1301.00. This angle crosses the retracement zone, making it a valid downside target. The Fibonacci level at $1302.60 and the angle at $1301.00 form a loose support cluster and is the best downside target.

Additional support is a 50% level at $1294.60 and a pair of uptrending angles at $1293.70 and $1291.00.

On the upside, overcoming $1322.10 could drive the market into the next downtrending angle at $1334.50.

The tone of the market today will be determined by trader reaction to the resistance cluster at $1321.00 to $1322.10. Watch for an acceleration to the downside if $1314.20 is taken out with conviction with $1302.60 the minimum downside target. All bets are off on the short side if buyers can take out $1322.10 convincingly.