Gold Price Futures (GC) Technical Analysis – July 26, 2017 Forecast

December Comex gold futures are trading lower shortly before the cash market opening. Sellers are following through to the downside for a second session after Monday’s bearish closing price reversal top.

Gold is being pressured by a recovery in the U.S. Dollar and increasing demand for higher-yielding assets. Later today, investors will get the opportunity to react to the Fed’s interest rate decision and monetary policy decision. A hawkish Fed would surprise investors and send gold prices lower. A dovish Fed should underpin gold, but since this has already been priced into the market, there may not be much of an upside reaction.

The biggest reaction will come from the movement in the stock market. The upside for gold will continue to be limited if stocks keep posting new all-time highs.

Technical Analysis

The main trend is down according to the daily swing chart. A trade through $1265.10 will change the main trend to up. A move through $1267.10 will further confirm the uptrend.

The main range is $1305.50 to $1211.10. Its retracement zone at $1259.30 to $1269.40 is resistance. This zone stopped the rally earlier in the week at $1265.10.

The short-term range is $1211.10 to $1265.10. If the selling continues then look for an eventual test of its retracement zone at $1238.10 to $1231.70. An uptrending angle passes through this zone at $1235.10, making it a valid downside target also.

Forecast

Based on the current price at $1252.90 and the earlier price action, the direction of the market today is likely to be determined by trader reaction to the downtrending angle at $1257.10.

A sustained move under $1257.10 will signal the presence of sellers. The daily chart is wide open under this angle with the next targets $1238.10 and $1235.10.

Overtaking $1257.10 will indicate the presence of buyers, but the rally is likely to be labored due to a series of potential resistance levels at $1259.30, $1261.10, $1263.10 and the main top at $1265.10.

Taking out $1265.10 will change the trend to up, but buyers will still have to deal with potential resistance at $1267.10, $1269.40 and $1270.50.

The real trigger point for an acceleration to the upside today is $1270.50.

It looks like we can stay short as long as the market remains under $1257.10.