Gold Price Futures (GC) Technical Analysis – August 29, 2017 Forecast

December Comex Gold futures gapped open on Wednesday, but the rally stalled at $1331.90. A recovery in U.S. equity markets from their gap lower opening is helping to slow down gold’s upside momentum. The U.S. Dollar is also bouncing off its low and Treasury futures are retreating from their tops.

The catalyst behind today’s rally is flight-to-safety buying in reaction to the news that North Korea fired a missile over Japan. Gold speculators are now waiting for a response from South Korea, the U.S. and perhaps Japan.

The United Nations is also meeting to discuss the incident, which is likely to lead to additional sanctions as well as the start of fresh peace negotiations. Obviously, North Korea was threatened by military exercises between the South Korea and the United States.

 Technical Analysis

The analysis is simple since upside momentum is so strong. Don’t complicate matters with all types of moving averages, oscillators and indicators. Just watch the price action.

The main trend is up according to the daily swing chart. The uptrend was reaffirmed when buyers took out the previous main tops at $1306.90 and $1307.00 on Monday.

Holding above $1307.00 indicates the buying is real and not just aggressive short-covering or buy stops.

The only chart pattern bullish traders have to fear at this time is the potentially bearish closing price reversal top.

The daily chart indicates there is plenty of room to the upside with the next major target coming in at $1353.00.

Forecast

Based on the current price at $1327.00 and the earlier price action, the direction of the gold market today is likely to be determined by trader reaction to the steep uptrending Gann angle at $1313.30. This angle, moving up at a rate of $16 per day, has been guiding prices higher since the $1281.30 main bottom on August 25.

Holding above $1313.30 will continue to give gold a bullish tone. A sustained move under this angle will indicate that momentum is shifting to the downside.

On Wednesday, the angle moves up at $1329.30 so gold needs to close above this level today or it may open weaker tomorrow.