Gold Price Futures (GC) Technical Analysis – Major Long-Term Support Zone $1468.30 – $1412.50

Gold futures surged on Tuesday, rebounding from a five-session decline after the Federal Reserve’s announcement to boost lending eased fears over a crunch in liquidity. It wasn’t safe-haven buying that drove gold prices higher. We know that because Treasurys and the U.S. Dollar are the true safe-havens.

Additionally, U.S. equity markets recovered after Monday’s steep decline, after the Fed stepped in and putting more liquidity into the economy. This triggered the relief rally in gold because buyers didn’t have to worry about selling tied to stock market margin calls.

If you’re still following analysts who believe gold is a safe-haven, or don’t understand that gold can rally when stocks, interest rates and the dollar rise, then stop. You can only hurt yourself. If you’re reading analysts who are inflexible and unwilling to think outside the box once in a while then you’re going to miss some big moves once in a while like the one we saw on Tuesday.

On Tuesday, April Comex Gold settled at $1528.90, up $42.40 or +2.85%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through $1704.30 will change the main trend to up. The next major downside target is the May 21, 2019 main bottom at $1301.60.

The main range is $1232.20 to $1704.30. Its 50% to 61.8% retracement zone is $1468.30 to $1412.50.

The minor range is $1704.30 to $1450.90. Its retracement zone at $1577.60 to $1607.50 is the primary upside target.

Short-Term Outlook

On Monday, April Comex gold found support at $1450.90, inside the major retracement zone at $1468.30 to $1412.50. This zone is controlling the longer-term direction of the market.

On the upside, the key resistance is the retracement zone at $1577.60 to $1607.50. Since the main trend is down, sellers are likely to come in on a test of this area.