Gold Price Futures (GC) Technical Analysis – Trading on Strong Side of $1798.80 – $1770.40 Retracement Zone

Gold futures are edging higher on Wednesday shortly after the release of the minutes from the Federal Reserve’s meeting in June. The market is being primarily supported by lower Treasury yields, while a stronger U.S. Dollar is helping to keep a lid on those gains. Gold is currently trading inside yesterday’s range, which tends to indicate investor indecision and impending volatility.

At 18:24 GMT, August Comex gold futures are trading $1805.40, up $11.20 or +0.62%.

In other news, Federal Reserve officials talked tapering at their most recent meeting, but few seemed in a rush to get the process going, according to minutes released Wednesday afternoon.

The Federal Open Market Committee meeting summary provided only a few new glimpses into talks about when the central bank should begin reducing the pace of its bond purchases.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $1906.90 and $1919.20 will change the main trend to up. A move through the $1750.20 swing bottom will signal a resumption of the downtrend.

Gold is currently trading on the strong side of a retracement zone at $1798.80 to $1770.40. Inside this range is a minor pivot at $1782.90. All three price levels could attract counter-trend buying.

The short-term range is $1919.20 to $1750.10. Its retracement zone at $1834.70 to $1854.60 is the primary upside target. Since the main trend is down, look for sellers on the first test of this area. They will be trying to form a potentially bearish secondary lower top.

Daily Swing Chart Technical Forecast

The direction of the August Comex gold futures contract into the close on Wednesday is likely to be determined by trader reaction to $1798.80.

Bearish Scenario

A sustained move under $1798.80 will indicate the presence of sellers. This could trigger a quick break into the pivot at $1782.90. If this level fails as support then look for the selling to possibly extend into the main Fibonacci level at $1770.40. This is the last potential support before the $1750.10 main bottom.

Bullish Scenario

A sustained move over $1798.80 will signal the presence of buyers. Taking out $1815.70 will indicate the buying is getting stronger with the short-term retracement zone at $1834.70 to $1854.60 the next likely target. Look for sellers to return on the first test of this zone.