Comex Gold Futures (GC) Technical Analysis – January 17, 2017 Forecast

February Comex Gold futures are trading about 1.45% higher early Tuesday in reaction to a sharp break in the U.S. Dollar and worries over Brexit.

President-elect triggered a sell-off in the dollar after he told the Wall Street Journal that the U.S. is losing its competitiveness because the dollar is “too strong”.

Stock traders are hedging their positions and speculators are buying gold ahead of U.K. Prime Minister Theresa May’s speech that will outline her plan for Britain to exit the European Union.

Technical Analysis

The main trend is up according to the daily swing chart. The uptrend resumed earlier today when buyers took out last week’s high at $1207.20. If the upside momentum continues then the market could make a run at the November 22 top at $1223.50 and the November 16 top at $1236.10. Today’s price action also makes $1187.50 a new minor bottom.

The main range is $1341.00 to $1124.30. Its retracement zone at $1232.70 to $1258.20 is the primary upside target. A downtrending angle passes through this zone at $1249.00, making it a valid upside target also.

On the downside, retracement zone support comes in at $1193.40, $1180.20, $1165.30 and $1155.40.

Forecast

Based on the current price at $1213.50, if the upside momentum continues then look for gold to make a run at the main top at $1223.50. This is followed closely by the major 50% level at $1232.70 and the main top at $1236.10.

If gold breaks then look for a possible break into $1193.40, $1187.50 and $1180.20.

Today is likely to be a new driven day so be prepared for volatility and a possible two-sided trade. The British Pound is reacting as if PM May’s speech is already built into the price. Gold could break if the Pound rallies or if May calms people’s fears.