Gold Price Futures (GC) Technical Analysis – January 8, 2019 ForecastBased on the early price action and the current price at $1283.40, the direction of the February Comex gold market the rest of the session is likely to be determined by trader reaction to the major 50% level at $1285.70.
Gold is trading lower shortly before the regular session opening as traders continue to shed the so-called safe-haven asset in response to increased demand for risk. Rising Treasury yields are helping to make the U.S. Dollar a more attractive investment while dampening foreign demand for dollar-denominated gold. If the downside momentum continues then sellers may take a run at last Friday’s low. A trade through this level will confirm last week’s closing price reversal top.
At 1256 GMT, February Comex gold is trading $1283.30, down $6.60 or -0.50%.
Daily Technical Analysis
The main trend is up according to the daily swing chart, however, Friday’s closing price reversal top indicates that momentum may be getting ready to shift to the downside.
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 trigger the start of a 2 to 3 day correction with the first target a short-term 50% level at $1268.50.
The intermediate 50% level at $1258.60 is the next downside target. The primary downside target is the main retracement zone at $1251.40 to $1239.80.
On the upside, the major 50% to 61.8% retracement zone at $1285.70 to $1312.30 is acting like resistance. It stopped the rally on Friday at $1300.40.
Daily Technical Forecast
Based on the early price action and the current price at $1283.40, the direction of the February Comex gold market the rest of the session is likely to be determined by trader reaction to the major 50% level at $1285.70.
A sustained move over $1285.70 will indicate the presence of buyers. The first target is the steep uptrending Gann angle at $1296.50.
Crossing to the strong side of $1296.50 will put the market in a bullish position. This should create the upside momentum needed to take out $1300.40. This could trigger a further rally into the major Fibonacci level at $1312.30.
A sustained move under $1285.70 will signal the presence of sellers. The first downside target is $1278.10. Taking out this level could trigger an acceleration to the downside with the first targets coming in at $1268.50 and $1266.50. Since the main trend is up, watch for buyers to re-emerge on a test of this area.