Comex Gold Futures (GC) Technical Analysis – August 26, 2015 Forecast

December Comex Gold futures traded lower on Tuesday, confirming the previous day’s closing price reversal top. The sell-off reached the short-term objective, completing the chart pattern. The reversal top doesn’t mean the main trend has changed to down, but it does indicate a shift in momentum to the downside.

The main trend is up according to the daily swing chart. It will turn down on a trade through $1108.50.

Several ranges are influencing the market at this time. The main range is $1207.30 to $1073.70. Its retracement zone at $1140.50 to $1156.30 is currently resistance.

The intermediate range is $1073.70 to $1169.80. Its retracement zone at $1121.70 to $1110.40 is a potential downside target.

The short-term range is $1108.50 to $1169.80. Its retracement zone at $1139.10 to $1131.90 is currently being tested.

The 50% levels of the main range and the short-term range combine to form a very powerful pivot area at $1139.10 to $1140.50. This area is essentially controlling the direction of the market.

A sustained move over $1140.50 will signal the presence of buyers. This could trigger a rally into the price cluster at $1156.30 to $1156.50. Overtaking the downtrending angle at $1159.30 will signal that the buying is getting stronger. Overcoming the uptrending angle at $1165.70 will put the market in an extremely strong position with the next upside target a downtrending angle at $1183.30.

A sustained move under $1139.10 will signal the presence of sellers. The first downside objective is a price cluster at $1132.50 to $1131.90. This was tested earlier in the session.

If $1131.90 is taken out with conviction then look for the break to extend into another price cluster at $1121.70, $1120.50 and $1119.70. Look for a technical bounce on the first test of this area, but be prepared for an acceleration to the downside if it fails since it is also a trigger point for an acceleration to the downside. The next target is another price cluster at $1111.30 to $1110.40.

Based on the early price action, the direction of the market today is likely to be determined by trader reaction to $1139.10 to $1140.50. Look for a bullish tone on a sustained move over $1140.50 and a bearish tone to develop on a sustained move under $1139.10.