Gold Price Futures (GC) Technical Analysis – Trader Reaction to $1267.90 Will Set the Tone for the Week

December Comex Gold futures finished lower last week. The market traded near the high end of the range most of the week but collapsed on Friday after the U.S. Dollar rose in reaction to the October U.S. Non-Farm Payrolls report.

Supporting the market are concerns over political and geopolitical events. Resistance is being fueled by rising Treasury yields, a firmer U.S. Dollar and a strong appetite for higher-risk assets.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. However, momentum has been trending lower for several weeks. A trade through $1262.80 will change the main trend to down.

A move through $1308.40 will signal a resumption of the uptrend. This will also make $1262.80 a new secondary higher bottom.

The market is also trading inside a major retracement zone, bounded by $1267.90 to $1298.10.

The main range is $1211.10 to $1362.40. Its 50% level or pivot at $1286.80 is controlling the near-term direction of the market.

Weekly Technical Forecast

Based on last week’s close at $1267.90 and the price action, the direction of the gold market this week is likely to be determined by trader reaction to the major 50% level at $1267.90.

A sustained move over $1267.90 will signal the presence of buyers. This could create a labored rally with a series of targets at $1143.10, $1286.80, $1290.40 and $1298.10.

The trigger point for a surge to the upside is $1298.10. This could lead to a test of $1308.40.

A sustained move under $1267.90 will indicate the presence of sellers. If this move creates enough downside momentum then look for sellers to go after the bottom at $1262.80.

Taking out $1262.80 with conviction could trigger a steep break into the next uptrending angle at $1245.10.

Watch the price action and read the order flow at $1267.90 all week. Trader reaction to this level will tell us if the buyers or sellers are in control.