Gold Price Futures (GC) Technical Analysis – Weekly Chart Indicates Strength Over $1325.90, Weakness Under $1317.30

Gold futures finished higher last week, supported by a steep drop in Treasury yields, a weaker U.S. Dollar and a drop in demand for higher risk assets. A dovish Fed was primarily responsible for the strength in gold. It fueled a rally when it decided to leave interest rates unchanged, pause further rate hikes in 2019 and slash its growth forecasts.

Last week, June Comex gold futures settled at $1318.70, up $9.80 or +0.75%.

Gold prices were also supported by weaker-than-expected economic reports from the Euro Zone. These results supported the Fed’s notion of a weakening global economy.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. However, momentum is neutral. A trade through $1356.00 will reaffirm the uptrend. A move through $1287.50 will change the main trend to down.

The minor trend is down. This is putting downside pressure on the momentum. Helping to support momentum is the closing price reversal bottom at $1287.50 during the week-ending March 8. The combination of these two events is giving momentum its neutral tone.

The main range is $1410.30 to $1189.30. Its retracement zone at $1299.80 to $1325.90 is controlling the longer-term direction of the market. The market is currently testing the Fibonacci or upper level of this range.

Weekly Technical Forecast

Based on last week’s close at $1318.70, the direction of the June Comex gold market this week is likely to be determined by trader reaction to the uptrending Gann angle at $1317.30 and the main Fibonacci level at $1325.90.

Bullish Scenario

Holding the uptrending Gann angle at $1317.30 will indicate the presence of buyers, but taking out $1325.90 could trigger an acceleration to the upside. The weekly chart indicates there is room to rally with the downtrending Gann angle at $1349.30 the next likely upside target.

Taking out $1349.30 will indicate the buying is getting stronger. This could lead to a breakout over the main top at $1356.00.

Bearish Scenario

A failure to overcome $1325.90 will signal the presence of sellers. A failure to hold the uptrending Gann angle at $1317.30 will indicate the selling is getting stronger. This is a potential trigger point for an acceleration to the downside with the next major target the main 50% level at $1299.80. This is the last major support before the $1287.50 main bottom. Taking out this level will change the main trend to down.