Gold Price Futures (GC) Technical Analysis – Strengthens Over $1235.80, Weakens Under $1229.70

Gold futures are trading nearly flat early Monday. The U.S. Dollar is trading lower against a basket of currencies, but most of the major players appear to be on the sidelines ahead of Tuesday’s U.S. mid-term elections. The results will determine whether the Republican or Democratic Party controls Congress. Traders are expecting heightened volatility in all markets in reaction to the outcome.

At 0658 GMT, December Comex Gold futures are trading $1232.40, down $0.90 or -0.08%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $1246.00 will signal a resumption of the uptrend. The main trend will change to down on a trade through $1184.30.

Last Thursday, gold surged to $1239.30. Taking out this high will make $1213.40 a new main bottom. If this occurs then taking out this level will change the main trend to down.

The minor trend is also up according to the minor swing chart. A trade through $1213.40 will change the minor trend to down. This will also shift momentum to the downside.

At this time, the resistance is a retracement zone at $1235.80 to $1246.30. This zone stopped the buying at $1239.30 on November 1.

The support zone is $1215.20 to $1207.90. This zone stopped the selling at $1213.40 on October 31.

The short-term range is $1246.00 to $1213.40. Its 50% level or pivot is $1229.70.

Daily Swing Chart Technical Forecast

Based on the early trade, the direction of the December Comex Gold market on Monday is likely to be determined by trader reaction to the Fibonacci level at $1235.80.

A sustained move under $1235.80 will indicate the presence of sellers. The first downside target is the 50% level at $1229.70.

The daily chart starts to open up to the downside under $1229.70 with the next target $1222.70, followed by the support cluster at $1215.20 to $1213.40.

A sustained move under $1235.80 will signal the presence of buyers. This could lead to a quick test of $1239.30.

Taking out $1239.30 will indicate the buying is getting stronger with the next target a resistance cluster at $1246.00 to $1246.30.

The 50% level at $1246.30 is a potential trigger point for an acceleration to the upside with $1264.90 the next major upside target.