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Gold Price Futures (GC) Technical Analysis – Strong Upside Momentum Targets $1828.80 into Close

By:
James Hyerczyk
Published: Aug 27, 2021, 18:17 UTC

The direction of the December Comex gold futures contract into the close on Friday is likely to be determined by trader reaction to $1812.20.

Comex Gold

In this article:

Patience around the $1795.00 to $1800.00 area on the daily chart this week finally paid off for gold bulls as prices soared more than 1% late Friday after Federal Reserve Chair Jerome Powell stopped short of signaling when the U.S. central bank would start withdrawing its economic support and reiterated his view that current price spikes are transitory.

At 17:35 GMT, December Comex gold futures are trading $1820.30, up $25.10 or +1.40%.

In a speech to the Jackson Hole economic conference, Powell signaled the U.S. central bank will remain patient and repeated that he wants to avoid chasing “transitory” inflation and potentially discouraging job growth in the process – a defense in effect of the current approach to Fed policy.

Earlier in the week, we said to keep your power dry and wait for Powell’s speech. We also noted that the market was balanced at two 50% levels at $1795.00 and $1800.00, signaling that no one knows what Powell will say. We also said to keep it simple. Nothing fancy. Look for an upside bias over $1800.00 and a downside bias under $1795.00.

Daily December Comex Gold

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier in the session when buyers took out the previous main top at $1812.20. A trade through $1781.30 will change the main trend to down. A move through $1774.60 will reaffirm the downtrend.

The next upside target and potential resistance is $1828.80.

On the downside, the support is a pair of 50% levels at $1800.00 and $1795.00, followed by a short-term 50% level at $1758.50.

Daily Swing Chart Technical Forecast

The direction of the December Comex gold futures contract into the close on Friday is likely to be determined by trader reaction to $1812.20.

Bullish Scenario

A sustained move over $1812.20 will indicate the presence of buyers. If they continue to generate enough upside momentum then look for the move to extend into the Fibonacci level at $1828.80, followed by a pair of main top at $1837.50 and $1839.00. These two tops are potential trigger points for upside breakouts.

Bearish Scenario

A sustained move under $1812.20 will signal the presence of sellers. This could trigger a break into the pair of main bottoms at $1800.00 and $1795.00. Since the main trend is up, we expect buyers to come in on a test of these bottoms. They will be trying to defend the uptrend.

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

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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