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James Hyerczyk
Comex Gold

Gold futures are trading slightly lower early Thursday and remain rangebound for a fourth straight session as investors try to sort out the details of several events weighing on the price action. Traders appear to be uncertain about how to play the market given the lack of clarity over the partial trade deal between the United States and China, the fading optimism over Brexit and rising expectations of a Fed rate cut at the end of the month after the government reported surprisingly weak September retail sales.

At 03:34 GMT, December Comex gold is trading $1492.20, down $1.80 or -0.12%.

Daily December Comex Gold

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $1478.00 will signal a resumption of the downtrend. A trade through the $1465.00 main bottom will reaffirm the downtrend. The main trend will change to up on a trade through $1522.30.

The main range is $1396.40 to $1566.20. Its retracement zone at $1481.30 to $1461.30 is support. It’s also controlling the longer-term direction of the market.

The intermediate range is $1412.10 to $1566.20. Its retracement zone at $1489.20 to $1471.00 is also support. It overlaps the main 50% level at $1481.30.

The short-term range is $1566.20 to $1465.00. Its retracement zone at $1515.60 to $1527.50 is resistance. It stopped rallies at $1525.80 on October 3 and $1522.30 on October 10.

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Daily Swing Chart Technical Forecast

Based on this week’s price action and the current price at $1492.20, the direction of the December Comex gold futures contract on Thursday is likely to be determined by trader reaction to the 50% level at $1489.20.

Bullish Scenario

A sustained move over $1489.20 will indicate the presence of buyers. If this move can attract enough buyers, we could see a surge into the short-term 50% level at $1515.60. Overcoming this level will indicate the buying is getting stronger. This could lead to a labored rally with potential resistance $1522.30, $1525.80 and $1527.50.

Bearish Scenario

A sustained move under $1489.20 will signal the presence of sellers. This could lead to a labored break with potential support layered at $1481.30, $1478.00, $1471.00, $1465.00 and $1471.30. It is a lot of levels but that’s what happens when a market sits in a trading range for several months.

The trigger point for a steep sell-off is $1461.30. If sellers can take out this level with big volume then we could see an eventual break into $1412.10 and the July 1 bottom at $1396.40.

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