Gold Price Futures (GC) Technical Analysis – Needs to Take Out $1497.70 With Rising Volume to Trigger Breakout to Upside

Gold futures traded mostly flat on Monday as investors sought clarity on the details of the “Phase One” trade deal between the United States and China. Gold was underpinned by a weaker U.S. Dollar, but gave back some of those gains as the greenback rebounded from early selling pressure. Rising U.S. Treasury yields and strong demand for equities also capped the gold market.

At 21:32 GMT, February Comex gold is trading $1480.60, down $0.60 or -0.03%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through $1491.60 will signal a resumption of the uptrend. The main trend will change to down on a trade through $1463.00.

The sideways-to-higher rectangular chart pattern is helping to generate a slight upside bias. The series of higher-tops and higher-bottoms is also helping to generate a positive spin on gold prices. The market seems to be waiting for that one big buyer to launch a breakout to the upside.

The short-term range is $1453.10 to $1491.60. Its retracement zone at $1472.40 to $1467.80 is support.

The main range is $1525.20 to $1453.10. Its retracement zone at $1489.20 to $1497.70 is resistance. This zone stopped rallies on December 4 at $1489.90 and on December 12 at $1491.60.

Short-Term Outlook

Holding above the retracement zone at $1472.40 to $1467.80 is the first sign of buyers. Holding above the uptrending Gann angle at $1476.10 will indicate the buying is getting stronger. If this generates enough upside momentum then look for a spike into the main 50% level at $1489.20, followed by a main top at $1491.60 and another downtrending Gann angle at $1495.20.

The Fibonacci level at $1497.70 is the trigger point for an acceleration to the upside.

Side Notes

Basically, February Comex gold is being trapped by a pair of retracement zones at $1472.40 to $1467.80 and $1489.20 to $1497.70.

Holding inside these zones could lead to a further sideways trade. Look for a longer-term upside bias to develop on a sustained move over $1497.70, and for a longer-term downside bias to develop on a sustained move under $1467.80.

Keep an eye on the volume, however. Breakouts work better when there is increasing volume behind the move.