Gold Price Futures (GC) Technical Analysis – Bullish Over $1828.80, Bearish Under $1795.00

Gold futures traded sideways-to-lower on relatively low volume on Thursday as investors shrugged off the plunge in the U.S. Dollar and weak longs squared positions ahead of Friday’s U.S. Non-Farm Payrolls report that could influence the timing of the Federal Reserve’s tapering strategy.

On Thursday, December Comex gold futures settled at $1811.50, down $4.50 or -0.25%.

In economic news, weekly jobless claims came in slightly better than expected and hit the lowest since March 2020 at the height of the COVID crisis. This offset the disappointing employment data from Wednesday that showed the private sector added fewer jobs in August in the U.S. than expected.

Friday brings the major August jobs report, which investors are watching closely to decipher how fast the Federal Reserve will remove easy monetary policy. Economists predict 720,000 jobs were added in the month, down from 943,000 jobs added in July.

Any number from 720,000 on up should be bullish for U.S. Treasury yields and the U.S. Dollar. This should weigh on gold prices. Anything below 650,000 should be supportive for gold prices.

However, keep in mind that Monday is a U.S. bank holiday so we may not see the true reaction in the markets until traders return sometime next week.

Daily December Comex Gold

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum is trending lower. A trade through $1826.50 will signal a resumption of the uptrend. A move through $1781.30 will change the main trend to down.

The minor trend is also up. A trade through $1803.40 will change the minor trend to down. This will confirm the shift in momentum. The pair of minor tops at $1822.70 and $1826.50 indicates that sellers are defending a key retracement level at $1828.80.

Resistance is a Fibonacci level at $1828.80. Support is the 50% level at $1800.00

Additional support is the short-term retracement zone at $1795.00 to $1777.50.

Daily Swing Chart Technical Forecast

The direction of the December Comex gold market on Thursday is likely to be determined by trader reaction to $1815.00.

Bullish Scenario

A sustained move over $1815.00 will indicate the presence of buyers. If this move creates enough upside momentum then look for the buying to possibly extend into $1826.50, followed by $1828.80.

Crossing to the strong side of the Fibonacci level at $1828.80 will put the market in a position to trigger a potential breakout over the pair of main tops at $1837.50 and $1839.00.

Taking out $1839.00 could trigger an acceleration to the upside.

Bearish Scenario

A sustained move under $1815.00 will signal the presence of sellers. If this move generates enough downside momentum then look for a labored break into $1803.40, $1800.00 and $1795.00.

A bearish bias could start to develop if $1795.00 is taken out with strong selling volume. This could extend the selling into $1781.30, $1777.50 and $1774.60.

Be the first to comment

Leave a Reply

Your email address will not be published.