Gold Price Futures (GC) Technical Analysis – Key Support Zone is $1306.60 to $1291.50

Gold futures eked out a small gain last week after posting an inside move. The price action suggests investor indecision and impending volatility. The market was supported at times by a weaker U.S. Dollar and worries about a possible trade war. However, gains were limited by increased demand for higher risk assets and the softening of geopolitical risks.

April Comex Gold settled the week at $1324.00, up $0.60 or +0.05%.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart, however, momentum has been trending lower since the $1370.50 main top the week-ending January 26. A trade through $1370.50 will signal a resumption of the uptrend. A move through $1342.70 will change the main trend to down.

The minor trend is down. A trade through $1364.40 will change the minor trend to up.

The major support is the 50% level at $1271.50.

The intermediate range is $1242.70 to $1370.50. Its retracement zone at $1306.60 to $1291.50 is also a key support zone.

The short-term range is $1370.50 to $1303.60. Its 50% level or pivot is $1337.10. This price is controlling the short-term direction of the market. It provided resistance the last two weeks.

Weekly Technical Forecast

Based on last week’s close at $1324.00 and the price action, the direction of the gold market this week is likely to be determined by trader reaction to the 50% level at $1337.10.

Taking out $1337.10 will indicate the presence of buyers. This could drive the gold market into a pair of Gann angles at $1342.50 and $1346.70. Overtaking $1346.70 will indicate the buying is getting stronger with potential targets coming in at $1364.40 and $1370.50.

If buyers can take out $1370.50, we could see a surge into the August 2, 2016 main top at $1396.20.

A sustained move under $1337.10 will signal the presence of sellers. Crossing to the weak side of a downtrending Gann angle at $1314.50 will be a sign that the selling is getting stronger. This could trigger a move into the retracement zone at $1306.60 to $1291.50. This includes a low at $1303.60 and an uptrending Gann angle at $1294.70.

Look for volatility this week due to the release of the U.S. Consumer Inflation report.