Gold Price Futures (GC) Technical Analysis – July 28, 2018 Forecast

Sellers are increasing pressure on gold prices as we approach the regular session opening and the release of the latest U.S. second-quarter Gross Domestic Product report at 1230 GMT. Economists are calling for the report to show the economy grew by 4.0%, up from 2.0%. This report is important because it could have an influence on Fed policy. A stronger-than-expected number could solidify the odds of at least two more rate hikes in 2018.

At 1126 GMT, December Comex Gold is trading $1228.10, down $7.20 or -0.58%.

Dollar-denominated gold is also being pressured by rising U.S. Treasury yields and a stronger U.S. Dollar.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. Today’s trade through the minor bottom at $1227.00 has helped make $1244.70 a new main top. A trade through this top will change the main trend to up. The downtrend will resume on a move through $1221.00.

The main range is $1278.20 to $1221.00. Its retracement zone at $1249.70 to $1256.40 is resistance.

The minor range is $1221.00 to $1244.70. Its 50% level or pivot is at $1232.90. This level is acting like resistance today. Intraday momentum is being driven by this pivot.

Daily Swing Chart Technical Forecast

Based on the early trade, the direction of the December Comex Gold market today will be determined by trader reaction to the pivot at $1232.90.

A sustained move under $1232.90 will indicate the presence of sellers. If this move creates enough downside momentum then look for sellers to take out the minor bottom at $1227.00. If selling volume increases on this move then look for a test of the main bottom at $1221.00.

Taking out $1221.00 will signal a resumption of the downtrend. If the GDP number comes in higher than expected then gold could break sharply under this bottom with the psychological $1200.00 level the next target.

A sustained move over $1232.90 will signal the presence of buyers. If this move creates enough upside momentum then look for buyers to challenge $1244.70 then $1249.70. A miss to the downside by the GDP report could trigger a short-covering rally.

At 1230 GMT, look for heightened volatility as investors react to the GDP data.