Gold Price Futures (GC) Technical Analysis – Setting Up for Breakout While Riding the Storm Out

Looking at this week’s trading range, buy stops are probably piling up over $1508.00 and sell stops under $1478.00.
James Hyerczyk
Comex Gold

Gold futures are treading water late Friday after trading inside last Friday’s $1478.00 to $1508.00 range for the entire week as investors were held hostage by growing optimism over a Brexit agreement and a partial trade deal between the U.S. and China. At the same time, the rapidly dropping U.S. Dollar and increasing chances of a Fed rate cut, helped underpin prices.

At 20:24 GMT, December Comex gold futures are trading $1494.20, down $4.10 or -0.27%.

Daily December Comex Gold

Daily Technical Analysis

The main trend is down, but the market traded sideways last week, trapped inside last Friday’s trading range and a few 50% levels. The price action suggests investor indecision and impending volatility. Translation:  Be patient. There’s a big move coming.

A trade through $1478.00 will signal a resumption of the downtrend. The main trend will change to up on a move through $1522.30.

The main retracement zone support zone is $1489.10 to $1471.00.

Resistance is being provided by a series of 50% levels at $1495.40, $1504.20 and $1515.60.

Daily Technical Forecast

Based on the price action this week, traders seem to be attracted to an uptrending Gann angle at $1491.00 and the main 50% level at $1489.10.

Even if it holds these levels, the next rally is likely to be labored because of a series of resistance levels coming in at $1495.40, $1502.20, $1504.20 and $1507.30.

The buying is likely to start picking up over $1507.30 with the next upside target $1515.60.

The daily chart also shows the market is vulnerable to the downside under $1489.10. If this level is taken out with conviction then we could see an acceleration into a potential support cluster at $1478.00, followed by $1471.00 and $1465.00.

Side Notes

Confusion? Lack of Clarity? Both are good reasons for sitting on your hands and keeping your powder dry. The Brexit Deal is too close to call. A U.S.-China trade deal is still weeks away from being signed. The Fed rate cut is almost a done deal if you believe the CME FedWatch Indicator. However, the Federal Reserve Policymakers are still divided. There’s just too much risk guessing on a direction at current levels.

Looking at this week’s trading range, buy stops are probably piling up over $1508.00 and sell stops under $1478.00.

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