Gold Price Futures (GC) Technical Analysis – Trend Down, but Momentum Shifts to Upside

Gold futures soared late in the session on Friday after U.S. Treasury yields fell sharply and traders dumped risky assets. The price action was fueled by the news that Chinese trade negotiators had cancelled a visit to meet U.S. farmers after they wrapped up trade talks in Washington sooner than expected.

At 20:34 GMT, December Comex gold futures are trading $1523.60, up $17.40 or +1.16%.

According to reports, there was no explanation as to why they were cutting their trip short. The jump in demand for safe-haven assets like Treasurys, gold and the Japanese Yen indicate that investors feel the need to take protection over the weekend in case there is bad news about the high level negotiations scheduled for early October.

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 at $1490.70 on September 18 and its subsequent confirmation on Friday.

A trade through $1490.70 will negate the reversal bottom and signal a reversal of the downtrend. The main trend will change to up on a trade through $1566.20.

The minor trend is up. It changed to up when buyers took out the minor top at $1519.70. This confirmed the change in momentum.

The major support is the $1489.10 to $1471.00 retracement zone. The first upside target is the short-term retracement zone at $1528.50 to $1537.40.

Daily Technical Forecast

Holding above the downtrending Gann angle at $1518.20 will indicate that buyers are coming in ahead of the close. This could trigger a late session rally into a 50% level at $1528.50, followed by a Fibonacci level at $1537.40 and a downtrending Gann angle at $1542.20.

A break back under $1518.20 will likely lead to a test of the uptrending Gann angle at $1506.70.