Gold Price Futures (GC) Technical Analysis – Strengthens Over $1515.60, Weakens Under $1504.20

Gold futures are trading lower late Friday after an attempt to break out to the upside failed to attract enough buyers to sustain the rally. The market is being supported by a weaker U.S. Dollar, but gains have been limited by rising U.S. Treasury yields and strong demand for risky assets.

The catalyst behind the whipsaw price action in gold was fueled by a stronger-than-expected U.S. Non-Farm Payrolls report for the month of October. The government reported that the economy added 128K jobs in October. Traders were looking for a reading of 90K.

The government also revised September and August jobs numbers significantly higher:  August’s initial 168,000 estimate came all the way up to 219,000 while September’s jumped from 136,000 to 180,000. The unemployment rate moved to 3.6% and average hourly earnings increased 0.1% to a year-over-year 3% gain, in line with estimates.

At 18:15 GMT, December Comex gold is trading $1509.90, down -4.90 or -0.33%.

The market is also being pressured late in the session after the Chinese Ministry of Commerce said Vice Premier Liu He had a phone call with Robert Lighthizer and Steven Mnuchin on Friday. China said the two sides conducted “serious and constructive” discussions on “core” trade points and talked about arrangements for the next round of talks.

The White House said the trade representatives “made progress in a variety of areas and are in the process of resolving outstanding issues.”

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through $1522.30 will change the main trend to up. A move through $1478.00 will signal a resumption of the downtrend.

The main range is $1566.20 to $1465.00. Its 50% level at $1515.60 is currently being tested. It is acting like resistance.

The intermediate range is $1543.30 to $1465.00. Its 50% level at $1504.20 is providing support.

The major downside target is the long-term retracement zone at $1489.60 to $1471.40.

Daily Technical Forecast

The market is currently being controlled by a 50% level at $1515.60 and a 50% level at $1504.20.

Uptrending Gann angle support comes in at $1511.60. Downtrending Gann angle resistance drops in at $1515.30. This angles fall inside the zone created by the 50% levels.

The direction of the market into the close will be determined by trader reaction to $1515.60 to $1504.20. Look for an upside bias to develop on a sustained move over $1515.60 and for a downside bias to develop on a sustained move under $1504.20. Trading between these levels will create a choppy, two-sided trade.