Comex Gold Futures (GC) Technical Analysis – September 22, 2016 Forecast

December Comex Gold futures are trading slightly higher shortly before the cash market opening. The market may be higher, but there hasn’t been a follow-through to the upside after yesterday’s strong rally. This is occurring despite a lower U.S. Dollar so we have to conclude that greater demand for higher yielding assets like stocks are helping to cap the gains in the gold market.

The market is also responding to the mixed messages from the U.S. Federal Reserve. On Wednesday, the Fed left interest rates unchanged, but said the economy may be strong enough to warrant a rate hike in December. The dollar broke sharply on Wednesday, fueling a powerful short-covering rally in gold. Today, however, there has been no such follow-through move.

TECHNICAL ANALYSIS

Technically, the main trend is down according to the daily swing chart. A trade through $1357.60 will turn the main trend to up. A move through $1309.20 will reaffirm the downtrend.

Momentum is to the upside based on the new 2-day main bottom formed at $1309.20.

The short-term range is $1357.60 to $1309.20. Its retracement zone at $1333.40 to $1339.10 is the primary upside target. This zone is currently being tested.

FORECAST

BASED ON THE CURRENT PRICE AT $1336.70, THE DIRECTION OF THE DECEMBER COMEX GOLD MARKET TODAY WILL BE DETERMINED BY TRADER REACTION TO THE FIBONACCI LEVEL AT $1339.10 AND THE 50% LEVEL AT $1333.40.

A SUSTAINED MOVE OVER $1339.10 WILL INDICATE THE PRESENCE OF BUYERS. THIS COULD GENERATE ENOUGH UPSIDE MOMENTUM TO CHALLENGE THE DOWNTRENDING ANGLE AT $1346.60. THIS IS A POTENTIAL TRIGGER POINT FOR AN ACCELERATION INTO THE NEXT ANGLE AT $1352.10. THIS IS THE LAST POTENTIAL RESISTANCE ANGLE BEFORE THE $1357.60 MAIN TOP.

BASICALLY, LOOK FOR THE UPSIDE BIAS TO CONTINUE ON A SUSTAINED MOVE OVER $1339.10 AND FOR A DOWNSIDE BIAS TO BEGIN ON SUSTAINED MOVE UNDER $1333.40.