Gold Price Futures (GC) Technical Analysis – Downside Momentum Building for Test of $1311.40 to $1296.20

Rising U.S. Treasury yields, a stronger U.S. Dollar and expectations for further Fed rate hikes later this year drove June Comex Gold prices sharply lower last week. The easing of geopolitical tensions also weighed on demand for the safe-haven asset.

The fundamentals are expected to remain the same this week so the downside pressure is likely to continue.

Weekly Swing Chart Technical Analysis

The main trend is up according to the weekly swing chart, however, momentum is trending lower. A trade through $1309.30 will change the main trend to down.

The main range is $1247.20 to $1375.50. Its retracement zone at $1311.40 to $1296.20 is the primary downside target.

The short-term range is $1309.30 to $1369.40. Gold finished on the weak side of its retracement at $1332.30 to $1339.40, helping to give it a downside bias. This zone is new resistance.

Weekly Swing Chart Technical Forecast

Given the downside momentum into the close on Friday, sellers are likely to go after the main 50% level at $1311.40 this week. Crossing to the weak side of this zone should create the downside momentum needed to take out $1309.30 and change the main trend to down.

Taking out $1309.30 could trigger an acceleration into the main Fibonacci level at $1296.20. We could see a technical bounce on the first test of this level, but if it fails, don’t be surprised by an acceleration to the downside.

The daily chart indicates there is plenty of room to the downside with $1247.20 the next major downside target.

Overtaking the minor Fib at $1332.30 will signal the return of buyers. Taking out $1339.40 will mean that the buying is getting stronger.