Gold Price Futures (GC) Technical Analysis – January 16, 2019 Forecast

Gold futures are trading higher on Wednesday, however, the market continues to trade inside the price range from January 4, indicating investor indecision and impending volatility. The market is being supported by the new dovish Fed policy which is expected to keep downside pressure on the U.S. Dollar. This is helping to increase foreign demand for dollar-denominated gold. Increased demand for risk is helping to limit gains.

At 1521 GMT, February Comex Gold is trading $1293.20, up $4.80 or +0.38%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. However, upside momentum has been weakening since the formation of the closing price reversal top at $1300.40 on January 4.

A trade through $1278.10 will confirm the potentially bearish chart pattern.

The short-term range is $1300.40 to $1278.10. Its 50% level or pivot at $1289.20 is controlling the short-term direction of the market.

The major 50% level at $1285.70 is also acting like support.

The main range is $1236.50 to $1300.40. Its 50% level at $1268.50 is the primary downside target.

Daily Technical Forecast

Based on the early price action and the current price at $1293.20, the direction of the February Comex Gold futures contract the rest of the session is likely to be determined by trader reaction to the 50% level at $1289.20.

Bullish Scenario

A sustained move over $1289.20 will indicate the presence of buyers. If this move can generate enough upside momentum through increased buying volume then we could see a more into $1300.40. Taking out this level could trigger an acceleration into the major Fibonacci level at $1312.30.

Bearish Scenario

A sustained move under $1289.20 will signal the presence of sellers. However, the trigger point for an acceleration to the downside is the 50% level at $1285.70. The first target is an uptrending Gann angle at $1278.50, followed by the minor bottom at $1278.10. Taking out this bottom could trigger another acceleration into the 50% level at $1268.50.