Gold Price Futures (GC) Technical Analysis – Consolidating Inside Retracement Zone at $1889.70 to $1842.60
Gold futures are trading higher late in the session on Thursday on concern over the logistics of a potential COVID-19 vaccine roll-out as U.S. case continued to surge, while hopes of more fiscal and monetary stimulus offered support to the precious metal.
Gold was generally supported by a plunge in U.S. Treasury yields that drove the U.S. Dollar lower. The drop in the greenback made dollar-denominated gold a more attractive investment.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. A trade through $1848.00 will signal a resumption of the downtrend. The main trend will change to up on a move through $1966.10.
The main range is $1690.10 to $2089.20. The market is in a position to close inside its retracement zone at $1889.70 to $1842.60 for the fourth straight session. This tells us that this zone is controlling the near-term direction of the market.
The minor range is $1966.10 to $1848.00. Its 50% at $1907.10 is resistance and a potential trigger point for an acceleration to the upside.
Trader reaction to $1889.70 and $1842.60 should determine the direction of the gold market over the near-term.
A sustained move over $1889.70 will indicate the presence of buyers. This should lead to a test of $1907.10. Overtaking this level could trigger an acceleration to the upside with $1966.10 – $1970.10 the next likely upside target.
A sustained move under $1842.60 will signal the presence of sellers. This could lead to a labored break however due to a series of potential support levels at $1819.30, $1788.30 and $1772.00.