Gold Price Futures (GC) Technical Analysis – Aggressive Buyers May Be Defending $1272.70 to $1267.30

Based on Tuesday’s price action and the current price at $1274.40, the direction of the gold market into the late session close is likely to be determined by trader reaction to the 50% level at $1272.70.
James Hyerczyk
Comex Gold

Gold prices are trading lower late Tuesday after hitting a two-week low earlier in the session. However, the market is attempting to claw back most of its earlier losses into the close. Throughout the session the market continued to straddle a major 50% level, suggesting longer-term investors may be recognizing value. Additionally, aggressive counter-trend traders may be trying to defend the low for the year at $1267.30 in an effort to prevent a steep sell-off into $1253.00.

At 19:54 GMT, June Comex gold futures are trading $1274.40, down $2.90 or -0.23%. This is up from a low of $1269.00.

Gold is attempting to rebound late in the session despite firmer U.S. Treasury yields and increased demand for higher risk assets. A volatile two-sided swing in the U.S. Dollar index may be behind gold’s intraday comeback rally. The index was whipped around by an intraday rally in the Euro.

Daily June Comex Gold

Daily Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the closing price reversal top at $1304.20 on May 14.

The main trend will change to down on a move through the last swing bottom at $1267.30.

Gold is currently testing a major 50% to 61.8% retracement zone at $1272.70 to $1253.00. This zone is controlling the longer-term direction of the market.

Daily Technical Forecast

Based on Tuesday’s price action and the current price at $1274.40, the direction of the gold market into the late session close is likely to be determined by trader reaction to the 50% level at $1272.70.

Bullish Scenario

A sustained move over $1272.70 will indicate the presence of buyers. If this creates enough upside momentum then look for the rally to possibly extend into the steep downtrending Gann angle at $1284.20.

Bearish Scenario

A sustained move under $1272.70 will signal the presence of sellers. This could lead to a retest of the intraday low at $1269.00. If this fails then look for the selling to extend into the main bottom at $1267.30.

If $1267.30 is taken out with heavy selling volume then look for a potential acceleration into the major Fibonacci level at $1253.00.

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