June Comex Gold Strengthens Over $1908.10, Weakens Under $1897.70

Gold futures are trading higher on Friday, but off their intraday high. The early strength represented follow-through short-covering following yesterday’s closing price reversal bottom. A weaker U.S. Dollar was the catalyst providing the support, however, gains were capped by rising U.S. Treasury yields.

At 12:43 GMT, June Comex gold futures are trading $1910.10, up $18.80 or +0.99%. On Thursday, the SPDR Gold Shares ETF (GLD) settled at $176.89, up $0.91 or +0.52%.

Despite today’s gains, gold is still in a position to finish lower for the week. It’s also set-up for about a 1.1% loss for the month, its first monthly drop since January.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. However, momentum is trending higher following the confirmation of Thursday’s closing price reversal bottom.

A trade through $2003.00 will change the main trend to up. A move through $1870.90 will negate the chart pattern and signal a resumption of the downtrend.

The market is currently testing a support cluster at $1908.10 – $1870.90.

On the upside, the nearest resistance is a pair of retracement levels at $1932.90 and $1958.70.

The short-term range is $2082.00 to $1870.90. Its retracement zone at $1976.50 – $2001.40 is controlling the upside direction of the market.

Daily Swing Chart Technical Forecast

The direction of June Comex gold on Friday is likely to be determined by trader reaction to $1908.10 and $1897.70.

Bullish Scenario

A sustained move over $1908.10 will indicate the presence of buyers. If this creates enough upside momentum then look for a surge into the 50% level at $1932.90.

Sellers could come in on the first test of $1932.90, but overcoming this level could extend the move into the long-term Fibonacci level at $1958.70.

Bearish Scenario

A sustained move under $1897.70 will signal the presence of sellers. If this generates enough downside momentum then look for a retest of the closing price reversal bottom at $1870.90.

Taking out $1870.90 will not only signal a resumption of the downtrend, but it could also trigger an acceleration to the downside with $1824.40 the next major target.