Gold Price Futures (GC) Technical Analysis – Strengthens Over $1870.30, Weakens Under $1855.10

Gold futures are trading higher on Wednesday, bolstered by a weaker U.S. Dollar. Gains are being capped, however, by a jump in U.S. Treasury yields and stronger equity markets. Trading conditions are thin due to the upcoming holidays. This is helping to fuel some of the two-sided trading we’ve been witnessing this week.

At 16:25 GMT, February Comex gold is trading $1876.40, up $6.10 or +0.33%.

The overnight trade was a little volatile after President Donald Trump threatened not to sign the recently passed fiscal stimulus bill. However, the news became a non-event once traders realized his veto was be wasted because the House and the Senate have the votes to override the move.

In economic news, the number of Americans filing first-time claims for unemployment benefits remained elevated but posted an unexpected fall last week. This event may have helped stocks rally, but gold traders showed little reaction to the news.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $1912.00 will signal a resumption of the uptrend. The main trend will change to down on a move through $1820.00.

The main range is $1973.30 to $1767.20. Its retracement zone at $1870.30 to $1894.60 is currently acting like resistance.

The minor range is $1820.00 to $1912.00. Its retracement zone at $1866.00 to $1855.10 is support.

The short-term range is $1767.20 to $1912.00. Its retracement zone at $1839.60 to $1822.50 is additional support.

Daily Swing Chart Technical Forecast

The direction of the February Comex gold market the rest of the session is likely to be determined by trader reaction to $1870.30.

Bullish Scenario

A sustained move over $1870.30 will indicate the presence of buyers. This could trigger a move into $1894.60 then $1912.00. Be careful chasing rallies however because of the light volume.

Bearish Scenario

A sustained move under $1870.30 will signal the presence of sellers. This could lead to a labored break over the near-term with potential support targets coming in at $1855.10 and $1839.60.

For a look at all of today’s economic events, check out our economic calendar.