Gold Price Futures (GC) Technical Analysis – Strong Over $1917.90, Weak Under $1881.60; Rangebound in Between
Gold futures are trading lower on Wednesday at dead center of the session’s wide range as traders continued to assess the impact of the current stalemate in the U.S. presidential election.
After an early session plunge in prices, gold spent most of the regular session clawing back those earlier losses on the hope that a Joe Biden victory would lead to massive amounts of new fiscal stimulus. But those dreams may have died after election results showed the Republicans would retain control of the Senate, which would make it difficult to pass a huge coronavirus stimulus package.
At 19:44 GMT, December Comex gold futures are trading $1897.90, down $12.50 or -0.65%.
Although Joe Biden is tipped to win the election, the Democrats appeared to be falling short in their attempts to take control of the U.S. Senate. Gold was underpinned by this news and weakness in the U.S. Dollar, which gave up earlier gains against major currencies, while stocks rallied.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart, however, momentum is trending higher. The main trend will change to up on a move through the last main top at $1936.00. A move through $1859.20 will reaffirm the downtrend.
The minor trend is up. The minor trend changed to up early Tuesday when buyers inched through the previous minor top at $1913.80. The new minor top is $1917.90. Buyers will have to take out this top in order to reaffirm the uptrend.
The market is having a lot of trouble clearing a series of retracement levels. Once they clear this area, we’ll get a better idea of where traders want to take the gold market.
The market is currently trading inside a 50% level at $1917.40 and a Fibonacci level at $1881.60. It’s also straddling levels at $1889.70, $1897.60 and $1906.70.
A sustained move over $1917.90 will indicate the buying is getting stronger. This could trigger a surge into a pair of main tops at $1936.00 and $1939.40. The latter is a potential trigger point for an acceleration into $1970.10.
A sustained move under $1881.60 will signal the presence of sellers. This could trigger an acceleration into the main bottom at $1859.20. This is followed by a long-term Fibonacci level at $1842.60.
Holding between $1917.90 and $1881.60 will indicate investor indecision.
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