Gold Price Futures (GC) Technical Analysis – Testing Long-Term Retracement Zone at $1468.30 – $1412.50Based on the price action this week, it looks as if the direction of the April Comex gold market over the near-term is likely to be determined by trader reaction to the main 50% level at $1468.30.
Gold futures are trading nearly flat late in the session on Thursday. A mixed batch of fundamentals is behind the tentative price action. A strong U.S. Dollar is helping to keep a lid on prices, while a drop in Treasury yields is underpinning prices. Stocks are trading higher on Thursday, which is helping to relieve some of the tension in gold from margin call selling. However, until the liquidity issues goes away, investors are going to favor U.S. Dollars over gold.
At 17:34 GMT, April Comex gold is trading $1479.00, up 1.10 or +0.07%.
Don’t fall asleep on this market. Prices are going to soar once the dollar buying is over.
Daily Technical Analysis
The main trend is down according to the daily swing chart. A trade through $1450.90 indicate a resumption of the downtrend. The main trend will change to up on a move through $1704.30. This is highly unlikely, however, there is room for a normal 50% to 61.8% retracement.
The main range is $1232.20 to $1704.30. Its retracement zone at $1468.30 to $1412.50 has been acting like support all week. This zone is controlling the longer-term direction of the market.
The minor range is $1704.30 to $1450.90. Its retracement zone at $1577.60 to $1607.50 is the primary upside target. Since the trend is down, sellers could come in on a test of this zone.
Based on the price action this week, it looks as if the direction of the April Comex gold market over the near-term is likely to be determined by trader reaction to the main 50% level at $1468.30.
Over the longer-term, the direction of the market will be determined by trader reaction to the main Fibonacci level at $1412.50.
Trading between $1468.30 and $1412.50 will likely generate a choppy or neutral trade. Inside this zone is an uptrending Gann angle at $1431.70. This makes it a valid downside target and possible support.
Holding above $1468.30 will indicate the presence of buyers. If this move can attract enough counter-trend buyers, or if there is a short-covering rally then look for a possible surge into the short-term retracement zone at $1577.60 to $1607.50.
Falling below $1468.30 will indicate the buying is getting weaker or the selling stronger. This could lead to a labored break with potential targets, this week’s low at $1468.30, the uptrending Gann angle at $1431.70 and the main Fibonacci level at $1412.50. All are capable of attracting counter-trend buyers.
The Fib level at $1412.50 is also the trigger point for an acceleration to the downside with the next target angle coming in at $1332.00.