Gold Price Futures (GC) Technical Analysis – January 18, 2019 Forecast

Gold futures are trading lower on Friday and in a position to settle lower for the week. The market is also trading in the lower half of its three-week range, suggesting that short-selling pressure is increasing, or the buying is getting weaker. Sellers are reacting to increasing hopes for a U.S.-China trade deal. This is helping to generate more demand for higher risk assets, dampening gold’s role as a safe-haven asset.

At 1300 GMT, February Comex gold is trading $1285.10, down $7.20 or -0.56%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has been trending sideways-to-lower since the formation of the potentially bearish closing price reversal top at $1300.40 on January 4.

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

Taking out $1278.10 will confirm the closing price reversal top, leading to further downside pressure.

The short-term range is $1300.40 to $1278.10. The market is also trading on the weak side of its 50% level or pivot at $1289.20.

The market is also trading on the bearish side of a major 50% level at $1285.70, suggesting the selling pressure is getting stronger.

The main range is $1236.50 to $1300.40. If the selling pressure continues to increase then its retracement zone at $1268.50 will become the primary downside target.

Daily Technical Forecast

Based on the current price at $1285.10 and the earlier price action, the direction of the February Comex gold futures contract on Friday, is likely to be determined by trader reaction to the 50% level at $1285.70 and the uptrending Gann angle at $1282.50.

Bullish Scenario

A sustained move over $1282.50 will indicate the presence of buyers. Overtaking the 50% level at $1285.70 will indicate the buying is getting stronger. This is followed by the next 50% level at $1289.20. Overtaking this level will put gold in a bullish position.

Bearish Scenario

A sustained move under $1285.70 will signal the presence of sellers. This could lead to a retest of the uptrending Gann angle at $1282.50.

The angle at $1282.50 is the trigger point for a potential acceleration to the downside with the first target $1278.10. If this level fails, the selling pressure could increase. This could lead to a test of the 50% level at $1268.50.