Gold Price Futures (GC) Technical Analysis – Trend Changes to Up on Trade Through $1522.30

Gold futures are trading sharply higher late Thursday with the rally being driven by a weaker U.S. Dollar, a drop in Treasury yields and lower demand for risky assets. The catalysts behind the rally are Wednesday’s Federal Reserve interest rate cut, Fed Chair Powell’s comment that the central bank won’t raise interest rates until inflation rises, and renewed concerns over a U.S. China trade deal after Bloomberg News reported that China may have doubts about reaching a long-term agreement.

At 20:00 GMT, December Comex gold is trading $1513.80, up $17.10 or +1.15%.

Daily Technical Analysis

The main trend is down according to the daily swing chart, however, the market is within striking distance of a pair of tops at $1522.30 and $1525.80. A move through these tops will both change the trend to up and reaffirm the change in trend, respectively.

The main bottom is $1465.00. A trade through $1522.30 will make $1478.00 a new higher bottom. At this time, the market is still trading within its mid-October range of $1522.30 to $1478.00.

On the downside, the major support is $1489.60 to $1471.40. This zone helped stop the selling at $1483.10 on October 30 and $1478.00 on October 11.

The short-term range is $1543.30 to $1465.00. Its 50% level at $1504.20 is a key pivot level to watch. It is now potential support.

The main range is $1566.20 to $1465.00. Its 50% level at $1515.60 is resistance. It stopped the rally early today. Crossing to the strong side of this level will indicate the buying pressure is increasing.

Daily Forecast

The market ran into a resistance cluster at $1515.60 to $1516.30 earlier today. Crossing to the bullish side of this area should lead to a test of the first main top at $1522.30, a downtrending angle at $1525.20 and a main top at $1525.80.

Taking out $1525.80 should trigger an acceleration to the upside with $1543.30 the next major upside target.

On the downside, crossing to the weak side of an uptrending Gann angle at $1509.00 will be the first sign of weakness. This could lead to a test of the pivot at $1504.20. This level must hold or prices could collapse to $1489.60.