Gold Price Futures (GC) Technical Analysis – Key Area to Watch for Counter-Trend Buyers is $1206.60 to $1197.20

December Comex Gold futures are trading lower for the week. The selling pressure is being fueled by increased demand for higher risk assets, firmer U.S. Treasury yields and a stronger U.S. Dollar. Solid U.S. economic data this week has also raised expectations of additional Fed rate hikes. On Wednesday, sellers hit gold prices after the release of a stronger-than-expected U.S. private sector jobs report. Traders are now preparing for Friday’s U.S. Non-Farm Payrolls report.

Weekly Technical Analysis

The main trend is down according to the weekly swing chart. The minor trend is also down. A new minor top was formed this week at $1246.00.

The short-term range is $1167.10 to $1246.00. If the selling pressure continues then we could see a pull-back into its 50% to 61.8% retracement zone at $1206.60 to $1197.20. If this market is preparing to rally further then buyers should come in on a test of this retracement zone.

The main range is $1388.10 to $1167.10. Its retracement zone at $1277.60 to $1303.70 is the primary upside target.

Weekly Technical Analysis Forecast

Based on this week’s price action, the direction of the December Comex Gold futures contract into Friday’s close is likely to be determined by trader reaction to the uptrending Gann angle at $1211.10.

Bullish Scenario

A sustained move over $1211.10 will indicate the presence of buyers. If this generates enough upside momentum then we could see a move into the minor top at $1246.00. This is a potential trigger point for an acceleration into a downtrending Gann angle at $1272.10, followed by the 50% level at $1277.60.

Bearish Scenario

A sustained move under $1211.10 will signal the presence of sellers. The next downside target is the short-term retracement zone at $1206.60 to $1197.20. This is followed by an uptrending Gann angle at $1189.10.

It looks as if the downside momentum will take the market into $1206.60 to $1197.20. This is the critical area on the weekly chart. Aggressive counter-trend buyers could step in on a test of this zone. They are going to try to form a secondary higher bottom. Sellers are going to try to drive the market through $1197.20 in an effort to make $1246.00 a new main top.