Gold Price Futures (GC) Technical Analysis – Powell’s Hawkish Remarks Boost Dollar, Sink Bullion

Gold futures are edging lower late in the session on Friday, erasing earlier gains after the U.S. Dollar rebounded strongly after earlier weakness.

Traders shrugged off potentially bullish U.S. economic news, choosing instead to focus on Federal Reserve Chairman Jerome Powell’s pledge to continue to fight soaring inflation with aggressive interest rate hikes.

At 19:12 GMT, August Comex gold futures are trading $1838.40, down $11.50 or -0.55%. The SPDR Gold Shares ETF (GLD) is at $171.26, down $1.43 or -0.83%.

In U.S. economic news, the Fed’s May industrial production report increased less than expected. Additionally, the Conference Board’s leading economic index fell by 0.4% in May, matching the revised drop seen in April as well as economist estimates.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $1882.50 will change the main trend to up. A move through $1806.10 will signal a resumption of the downtrend.

On the upside, resistance is the long-term Fibonacci level at $1844.00, followed by the short-term 50% level at $1854.80.

On the downside, support is the short-term retracement zone at $1837.30 – $1826.60.

Daily Swing Chart Technical Forecast

Trader reaction to the long-term Fibonacci level at $1844.00 is likely to be determine the direction of the September Comex gold futures contract into the close on Friday.

Bearish Scenario

A sustained move under $1844.00 will signal the presence of sellers. Taking out $1837.30 will indicate the selling pressure is getting stronger. This could trigger a late session break into $1826.60.

Bullish Scenario

A sustained move over $1844.00 will indicate the presence of buyers. If this creates enough upside momentum then look for a late session surge into $1854.80. Overcoming this level will indicate the buying is getting stronger with the intraday high at $1861.50 the next major target.