Gold Price Futures (GC) Technical Analysis – Short-Term Upside Target is $1574.90 to $1583.90

Gold futures are trading higher late Friday after a weaker U.S. Dollar drove up foreign demand for the dollar-denominated precious metal. Weaker demand for risky assets and a plunge in U.S. Treasury yields also supported the market.

On Wednesday, the U.S. and China signed their highly anticipated Phase One trade deal. However, the event was largely priced into the market, while the actual details of the agreement failed to calm the nerves of investors. Traders are worried about China’s compliance with the trade deal and the fact that Washington retained tariffs on some Chinese goods.

At 21:35 GMT, February Comex gold is trading $1556.10, up $11.50 or +0.75%.

Further rattling traders was a threat against American troops by Iranian President Hassan Rouhani. He said U.S. troops are “insecure” in the region today, and EU troops “might be in danger tomorrow,” according to a Reuters translation. Rouhani also demanded the U.S. leave and accused it of making the region insecure, saying it should “apologize to Tehran” for its “previous crimes.”

Daily Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has been trending lower since January 8.

The minor trend is down. It will turn up on a move through $1564.10. A trade through $1536.40 will indicate increasing selling pressure.

The main range is $1453.10 to $1613.30. Its retracement zone at $1533.20 to $1514.30 is the best support zone and value area.

The new short-term range is $1613.30 to $1536.40. Its retracement zone at $1574.90 to $1583.90 is the first upside target.

Short-Term Outlook

On Tuesday, February Comex gold found support on an uptrending Gann angle. This angle came in at $1539.10 on Wednesday. It moves up to $1540.10 on Thursday.

If the upside momentum continues then look for a move into the minor top at $1564.10. Taking out this level will change the minor trend to up. It could trigger a further rally into a downtrending Gann angle at $1573.30, followed by the short-term 50% level at $1574.90.

On the downside, taking out the minor bottom at $1536.40 could drive the market into the retracement zone at $1533.20 to $1514.30. Since the main trend is up, buyers are likely to step in on a test of this zone.