Gold Price Futures (GC) Technical Analysis – January 3, 2018 Forecast

February Comex Gold futures are trading slightly better shortly before the regular session opening. The market posted a two-sided trade earlier in the session, first rallying to its highest level since September 20 at $1323.00 then turning lower for the session. Traders are likely positioning themselves ahead of the release of the Fed minutes at 1900 GMT.

Most of the focus today will likely be on the FOMC commentary relating to the inflation outlook given the Fed’s underlying consumer inflation (CPI) forecasts were left unchanged at this meeting despite most members factoring in the impact of tax cuts delivered by the Trump administration in late December.

Hawkish minutes will be supportive for the U.S. Dollar. This should pressure gold. However, look for a possible spike to the upside if the Fed minutes are perceived as dovish.

Daily Technical Analysis

The main trend is up according to the daily swing chart. The trend was reaffirmed earlier today when buyers took out $1321.00. If the upside momentum continues, we could eventually see a test of the April 8 main top at $1365.80.

Gold is up 14 sessions from its last main bottom. This puts it in the window of time for a potentially bearish closing price reversal top. A higher-high, lower-close formation could trigger the start of a 2 to 3 day correction.

The main range is $1365.80 to $1238.30. Its retracement zone is $1317.10 to $1302.10. This is followed by a major, longer-term retracement zone at $1290.20 to $1272.30. The retracement levels are the first downside targets today and potential support levels.

Daily Technical Forecast

Based on the current price at $1318.40 and the earlier price action, the direction of the gold market today will likely be determined by trader reaction to the Fibonacci level at $1317.10.

A sustained move over $1317.10 will indicate the presence of buyers. This could trigger a move into a downtrending angle at $1325.80. This angle is a potential trigger point for an acceleration to the upside with another angle at $1345.80 the next upside target.

A sustained move under $1317.10 will signal the presence of sellers. This could trigger a break into the steep uptrending angle at $1294.30. This angle has been guiding the gold market higher for 14 sessions.