Comex Gold Futures (GC) Technical Analysis – May 25, 2015 Forecast

August Comex Gold futures finished lower on Friday after selling off from an early session rally. A sharp rise in the U.S. Dollar fueled the selling pressure. The catalyst was a stronger-than-expected U.S. consumer inflation report. Trading could be limited today because of bank holidays in the U.S., Europe and the U.K.

The main trend is up on the daily swing chart, but momentum is giving the market a downside bias. The price action over the past several months has produced a number of key retracement zones that have provided support and resistance at times. Until the market clears the trading ranges, traders have to expect more of the same back and forth trading.

The main range is the January 21 top at $1309.00 to March 17 bottom at $1143.80. Its 50% level is $1226.40. Traders tried to break out over this level recently, but the rally failed shortly after gold reached $1232.80 on May 18.

Another main range is $1143.80 to $1232.80. This range’s retracement zone is $1188.30 to $1177.80. It’s the primary downside target should strong selling pressure emerge.

The bottom at $1170.00 to the top at $1232.80 forms another range. Its retracement zone is $1201.40 to $1194.00. Its upper or 50% level at $1201.40 stopped the market last week when gold tested $1201.90. The price cluster at $1291.90 to $1201.40 could be considered support, but it is also a potential trigger point for an acceleration to the downside. The Fib level at $1194.00 is the next target.

Key Gann angle support comes in today at $1202.00. It forms a tight support cluster with the 50% level at $1201.40. Watch this area closely for a technical bounce or a possible acceleration to the downside.

On the upside, the nearest resistance drops in at $1212.80. If $1232.80 to $1201.90 forms a range then look for the rally to extend into the 50% level at $1217.40. This is followed by another downtrending angle at $1222.80.

The tone of the market today is likely to be determined by trader reaction to the cluster at $1202.00 to $1201.40.