Gold Price Futures (GC) Technical Analysis – April 3, 2019 Forecast

Gold futures are trading higher on Wednesday after posting a potentially bullish closing price reversal bottom on Tuesday and confirming the chart pattern earlier today. The catalyst behind the rally is the weaker U.S. Dollar. This is driving up demand for dollar-denominated gold.

The dollar is weakening because long-hedgers betting against a U.S.-China trade deal are bailing out of their positions after a report earlier today from the Financial Times said the two economic powerhouses are close to signing an agreement that would end the trade dispute.

At 06:06 GMT, June Comex gold futures are trading $1297.20, up $1.80 or +0.14%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, momentum shifted to the upside with the formation of the closing price reversal bottom and the subsequent confirmation on Wednesday.

The chart pattern does not signal a change in trend, but it could lead to a 2 to 3 day counter-trend rally. Essentially, it means the buying is greater than the selling at current price levels.

The minor trend is also down. A trade through $1289.50 will indicate the return of sellers. A move through $1287.50 will signal a resumption of the downtrend.

Earlier this week, gold closed below its December 31, 2018 settlement. However, it looks as if buyers have successfully defended this level as well as the low of the year at $1287.50.

Support is a pair of retracement levels at $1289.90 and $1285.50. If they fail, then look for a potential acceleration into $1268.90. Resistance is $1302.50. This is also a potential trigger point for an acceleration into $1310.20 to $1316.00.

Daily Technical Forecast

Based on the early price action and including the confirmation of the closing price reversal top, the first upside target is a resistance cluster at $1302.50 to $1302.80. Watch for a technical bounce on the first test of this area. Overcoming $1302.80, however, could trigger an acceleration to the upside with $1310.20 the minimum upside target.

If buyers fail to show up and the market begins to turn lower then depending on the downside momentum, we could see a retest of $1289.90 to $1289.50. If this fails, then look for the break to extend into $1287.50 then $1285.50. Look out to the downside if $1285. 50 is taken out with conviction. The next support is way down at $1268.90.