Based on last week’s close at $1356.20, the direction of the gold market this week is likely to be determined by trader reaction to the downtrending Gann angle at $1354.50.
April Comex Gold futures are trading lower early Monday as investors react to a slight rebound in the U.S. Dollar. Trading is thin as investors adjust to below average volume caused by a bank holiday in the U.S. and the Lunar New Year holiday in China.
The main trend is up according to the weekly swing chart. A trade through $1370.50 will signal a resumption of the uptrend. A move through $1309.00 will change the minor trend to down and signal a shift in momentum to the downside.
The short-term range is $1370.50 to $1309.00. Its 50% level or pivot is $1339.80. Holding above this level will help the market maintain its current upside bias.
The main range is $1242.70 to $1370.50. If $1309.00 fails as support then its retracement zone at $1306.60 to $1291.50 will become the primary downside target.
Based on last week’s close at $1356.20, the direction of the gold market this week is likely to be determined by trader reaction to the downtrending Gann angle at $1354.50.
A sustained move over $1354.50 will signal the presence of buyers. This could trigger a rally into the next downtrending Gann angle at $1362.50. This is the last potential resistance angle before the $1370.50 main top.
A sustained move under $1354.50 will indicate the presence of sellers. The daily chart begins to open up under this angle with the next target a potential support cluster at $1339.80 to $1338.50.
The angle at $1338.50 is a potential trigger point for an acceleration to the downside with the next target angle coming in at $1322.70.
The weekly chart will open up under $1322.70 with the next targets $1309.00 to $1306.60.
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.