Gold Price Futures (GC) Technical Analysis – Late Safe-Haven Buying into Dollar Driving Gold Prices Lower

Gold futures are weakening from earlier highs at the mid-session on Friday as flight-to-safety buying ahead of the long U.S. holiday week-end drives investors into the safe-haven U.S. Dollar and U.S. Treasury markets. Traders are reacting to increased concerns over the escalating trade war between the United States and China.

At 1629 GMT, December Comex Gold is trading $1205.30, up $0.30 or +0.02%.

Traders are also expressing concerns that a trade deal between the U.S. and Canada won’t be reached before today’s deadline. There are reports that President Trump would not make any compromises in trade talks with Canada.

Money is flowing into the U.S. Dollar this afternoon after the Canadian trade negotiator said, ‘we’re not there yet’ on a trade deal.

Daily Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the closing price reversal top on Tuesday at $1220.70.

A trade through $1220.70 will negate the chart pattern and signal a resumption of the uptrend. The main trend will change to down on a trade through $1189.50.

The minor trend is also up. A trade through $1201.20 will change the minor trend to down. This will confirm the shift in momentum.

The main range is $1244.70 to $1167.10. Its retracement zone at $1205.90 to $1215.10 is controlling the near-term direction of the gold market. At this time, sellers are threatening to take out the lower level support of this zone.

The minor range is $1167.10 to $1220.70. If the minor trend changes to down then look for the selling to extend into its retracement zone at $1193.90 to $1187.60.

Daily Technical Forecast

Based on the current price at $1205.30 and the intraday price action, the direction of the December Comex Gold market into the close is likely to be determined by trader reaction to the 50% level at $1205.90.

A sustained move under $1205.90 will indicate the presence of sellers. The first target is $1201.20. Look for a potential acceleration to the downside if this level fails. The daily chart indicates there is plenty of room to the downside with the first target coming in at $1193.90.

A sustained move over $1205.90 will signal the presence of buyers. However, we’re expecting to see a labored rally due to potential resistance at $1211.10, $1215.10 and $1215.70.