Gold Price Futures (GC) Technical Analysis – January 11, 2019 Forecast

Buyers returned to the gold market on Friday, driving the market higher after yesterday’s sell-off. The market is still trading inside last Friday’s wide range which suggests investor indecision and impending volatility. Gold is being supported by a weaker U.S. Dollar and on expectations the U.S. Federal Reserve will may pause interest rate hikes in 2019. Putting a lid on the rally is optimism over US-China trade relations and increased demand for risky assets.

At 0825 GMT, February Comex gold is trading at $1294.40, up $7.00 or +0.54%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. However, upside momentum stopped with the formation of a closing price reversal top on January 4. Since then the market has zig-zagged inside a wide range.

A trade through $1300.40 will negate the closing price reversal top and signal a resumption of the uptrend.

A move through $1278.10 will confirm the closing price reversal top. This could lead to the start of a 2 to 3 day sell-off.

The major retracement zone at $1285.70 to $1312.30 has been acting like resistance for more than a week.

The extremely short-term range is $1300.40 to $1278.10. The market has been straddling its 50% level or pivot at $1289.20 all week. Trader reaction to this level should control the direction of the market today.

The short-term range is $1236.50 to $1300.40. Its 50% level at $1268.50 is the first major downside target.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the February Comex gold market on Friday is likely to be determined by trader reaction to the pivot at $1289.20.

Bullish Scenario

A sustained move over $1289.20 will indicate the presence of buyers. The first target is yesterday’s high at $1298.00. This is followed by the closing price reversal top at $1300.40.

Taking out $1300.40 could trigger an acceleration to the upside with the next target angle coming in at $1308.50. Overcoming this angle will put gold in a strong position with the next target the Fibonacci level at $1312.30.

Bearish Scenario

A sustained move under $1289.20 will signal the presence of sellers. This could trigger a break into the major 50% level at $1285.70.

Look for the selling to get stronger if $1285.70 fails as support with $1278.10 the first target. This is followed by an uptrending Gann angle at $1272.50, followed by $1268.50.