Gold Price Futures (GC) Technical Analysis – Rangebound; Needs Stronger Volume to Fuel Successful Breakout

Gold futures are trading better late in the session on Tuesday, but off its highs. Today’s intraday spike was driven by rising inflation fears, which dampened demand for riskier assets. A firm U.S. Dollar helped cap gains, but lower Treasury yields provided some support.

At 19:03 GMT, December Comex gold is trading $1759.80, up $4.10 or +0.23%.

A global energy crunch has threatened economic outlook and fanned inflation fears, driving some investors toward safer assets.

The focus now shifts to the minutes from the Fed’s September 21-22 policy meeting and the consumer price index, both due on Wednesday.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, but momentum is trending lower. A trade through $1782.40 will signal a resumption of the uptrend. A move through $1745.40 will change the main trend to down.

The minor trend is also up. A trade through $1792.90 will change the minor trend to down. This will confirm the shift in momentum.

On the downside, support is $1757.40, $1751.80 and $1738.60.

On the upside, resistance is $1765.90, followed by $1779.00. The latter is a potential trigger point for a move into $1795.00 and $1800.00.

Daily Swing Chart Technical Forecast

The direction of the December Comex gold futures contract early Wednesday is likely to be determined by trader reaction to the pivot at $1757.40.

Bullish Scenario

A sustained move over $1757.40 will indicate the presence of buyers. The first upside target is $1765.90. This is a potential trigger point for an acceleration into $1779.00 to $1782.40.

Bearish Scenario

A sustained more under $1757.40 will signal the presence of sellers. This could lead to a labored break with potential support targets at $1751.80, $1792.90 and $1745.40.

Side Notes

This type of chart pattern typically leads to a strong breakout in either direction. However, the danger in taking the trade is the possibility of low volume.