Gold Price Futures (GC) Technical Analysis – Weak Under $1737.50 with $1711.90 Potential Downside Target

Gold futures are inching higher on Wednesday as U.S. Treasury yields continued to slide following Federal Reserve Chairman Jerome Powell’s reassurance that inflation would not spiral out of control. Meanwhile, a jump in the U.S. Dollar to its highest level since November 23 placed a lid on prices.

At 08:23 GMT, June Comex gold futures are trading $1730.30, up $2.80 or +0.16%.

Testifying at a hearing of the House Financial Services Committee on Tuesday, Fed Chair Powell downplayed concerns of some lawmakers about the possibility of coming inflation as the Fed’s loose monetary policy coincides with an economic reopening expected to spark the strongest growth since the 1980s.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $1676.20 will signal a resumption of the downtrend. The main trend will change to up on a trade through $1817.60.

The minor trend is also down. A trade through $1719.10 will indicate the selling pressure is getting stronger. The minor trend will change to up on a move through $1756.00. This will shift momentum to the upside.

The market is currently trading inside a major retracement zone at $1788.50 to $1711.90. This zone is controlling the longer-term direction of the gold market.

The short-term range is $1817.60 to $1676.20. Its retracement zone at $1746.90 to $1763.60 is resistance.

On the downside, minor support is $1716.10 to 1706.70.

The new minor range is $1756.00 to $1719.10. The market is currently trading on the weak side of its pivot at $1737.50.

Daily Swing Chart Technical Forecast

The direction of the June Comex gold market is likely to be determined by trader reaction to $1737.50.

Bearish Scenario

A sustained move under $1737.50 will indicate the presence of sellers. If this creates enough downside momentum then look for the selling to possibly extend into a series of levels at $1719.10, $1716.10, $1711.90 and $1706.70. The latter is a potential trigger point for an acceleration to the downside.

Bullish Scenario

A sustained move over $1737.50 will signal the presence of buyers. This could lead to a quick surge into $1746.90, followed by $1756.00 and $1763.60. The latter is a possible trigger point for an acceleration into $1788.50.