Gold Price Futures (GC) Technical Analysis – Strengthens Over $1788.50, Weakens Under $1781.00

Gold futures are edging higher on Tuesday despite a firm U.S. Dollar Index and a slight rise in U.S. Treasury yields. Investors aren’t reading too much into the move with many squaring positions or sitting on the sidelines ahead of Wednesday’s Federal Reserve announcements.

At 10:24 GMT, June Comex gold futures are trading $1780.30, up $0.20 or +0.01%.

While no major policy changes are expected from the Fed’s two-day policy meeting ending on Wednesday, investors will pay close attention to Chairman Jerome Powell’s outlook on the economy.

The biggest concern for bullish gold traders is whether the Fed can sound any more dovish than policymakers have been. In other words, some worry that a dovish Fed has already been priced into the market.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $1798.40 will reaffirm the uptrend. The main trend will change to down on a trade through $1723.20.

The minor trend is also up. A trade through $1768.20 will change the minor trend to down. This will shift momentum to the downside. A move through $1763.50 will reaffirm the change in trend.

The minor range is $1763.50 to $1798.40. The market is currently testing its 50% level at $1781.00.

The major resistance is the long-term 50% level at $1788.50.

The first short-term range is $1723.20 to $1798.40. Its 50% level at $1760.80 is potential support.

The second short-term range is $1677.30 to $1798.40. If the minor trend changes to down then look for its 50% level at $1737.90 to become the primary downside target.

The major support is the long-term 61.8% level at $1711.90.

Essentially, gold is testing the upper level of a long-term retracement zone at $1788.50 to $1711.90.

Daily Swing Chart Technical Forecast

The early price action suggests the direction of the June Comex gold market on Tuesday is likely to be determined by trader reaction to the minor pivot at $1781.00.

Bullish Scenario

A sustained move over $1781.00 will indicate the presence of buyers. This could trigger a quick move into the major 50% level at $1788.50. Overtaking this level will indicate the buying is getting stronger, setting up another potential move into the main top at $1798.40.

Taking out $1798.40 will reaffirm the uptrend. If this creates enough upside momentum then look for the rally to possibly extend into another main top at $1817.

Bearish Scenario

A sustained move under $1781.00 will signal the presence of sellers. If this creates enough downside momentum then look for the selling to possibly extend into a potential support cluster at $1768.20, $1763.50 and $1760.80.

The 50% level at $1760.80 is a potential trigger point for an acceleration to the downside with $1737.90 the next likely downside target.