James Hyerczyk
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Comex Gold

Gold futures are expected to open the pre-market session steady as traders continue to assess Friday’s weaker-than-expected U.S. Non-Farm Payrolls report and its potential impact on Federal Reserve policy.

Treasury yields plunged after the jobs report showed fewer than expected new hires in April, but then settled down and actually moved up from their intraday lows after further assessment indicated the job weakness may only be temporary.

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On Friday, June Comex gold futures settled at $1831.30, up $15.60 or +0.86%. This was down from an intraday high of $1844.60.

The U.S. labor market is expected to continue to improve as it works through worker and raw material shortages. This could stabilize yields and may even cap gold prices.

Daily June Comex Gold

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $1844.60 will signal a resumption of the uptrend. This could trigger a further rally into the February 10 main top at $1858.90. The main trend will change to down on a trade through $1754.60.

Monday is the seventh day up from the last main bottom on April 29. This put gold inside the window of time for a potentially bearish closing price reversal top. This won’t change the main trend to down, but it could trigger the start of a 2 to 3 day correction.

The new minor range is $1754.60 to $1844.60. Its 50% level or pivot at $1799.60 is the first potential downside target.

The best support is the major 50% level at $1788.50. This price is controlling the longer-term direction of the market.


Daily Swing Chart Technical Forecast

The direction of the June Comex gold market on Monday is likely to be determined by trader reaction to Friday’s close at $1831.30.

Bullish Scenario

A sustained move over $1831.30 will indicate the presence of buyers. Taking out $1844.60 will indicate the buying is getting stronger with $1858.90 the next likely upside target. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under $1831.30 will signal the presence of sellers. The first downside target is a minor pivot at $1799.60. Buyers could come in on the first test of this level. If it fails then look for the selling to possibly extend into the major 50% level at $1788.50.

Side Notes

Taking out $1844.60 then closing below $1831.30 will form a potentially bearish closing price reversal top. If confirmed, this could trigger the start of a 2 to 3 day correction.

For a look at all of today’s economic events, check out our economic calendar.
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