Gold Price Futures (GC) Technical Analysis – Momentum Shift; Strengthens Over $1765.90, Weakens Under $1757.40

Gold futures are trading higher at the midsession on Monday after reversing earlier weakness. The market is being underpinned by a weaker U.S. Dollar but steady U.S. Treasury yields may be helping to limit gains. Risk off sentiment in the U.S. equity markets may be lifting speculative demand, but investors aren’t buying the move because of the hawkish outlook from the Federal Reserve.

At 16:28 GMT, December Comex gold futures are trading $1768.90, up $10.50 or +0.60%.

Thin trading conditions ahead of Friday’s important U.S. Non-Farm Payrolls report may be responsible for the latest whip-saw action. I am bearish gold because the trend is down and the hawkish Fed remarks support the downtrend. One has to think about selling rallies under those conditions until the trend changes to up.

Gold could continue to see counter-trend bursts of energy until both Treasury yields and the U.S. Dollar renew their ascents.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, but momentum shifted to the upside earlier today. A trade through $1788.40 will change the main trend to up. A move through $1721.10 will signal a resumption of the downtrend.

The minor trend is up. It turned up earlier today, shifting momentum to the upside. A trade through $1747.70 will change the minor trend to down.

The minor range is $1810.60 to $1721.10. The market is currently trading on the strong side of its 50% level or pivot at $1765.90, making it new support.

On the downside, additional support levels come in at $1757.40, $1738.60 and $1716.00.

On the upside, resistance is $1779.00, followed by a pair of 50% levels at $1795.00 and $1800.00.

Daily Swing Chart Technical Forecast

The direction of the December Comex gold market into the close on Monday is likely to be determined by trader reaction to the 50% level at $1765.90.

Bullish Scenario

A sustained move over $1765.90 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into the 50% level at $1779.00.

Overtaking $1779.00 will indicate the buying is getting stronger. This could trigger a rally into $1788.40. A trade through this level could trigger a rally into a pair of 50% levels at $1795.00 and $1800.00, which is the major resistance area.

Bearish Scenario

A sustained move under $1765.90 will signal the presence of sellers. The first downside target is $1757.40, followed by $1747.70. The latter is a potential trigger point for an acceleration into $1738.60.