Gold futures are trading slightly better shortly before the regular session opening on Friday and the release of a slew of U.S. economic reports including Retail Sales at 1230 GMT. Demand for risky assets is driving the price action along with lingering concerns over global trade disputes.
Later today, we’re going to get the latest position data from the Commodity Futures Trading Commission. This will tell us if hedge funds and money managers reduced short positions, or added to net short positions. This could have an impact on the trade.
At 1154 GMT, December Comex Gold is trading $1209.70, up $1.70 or +0.13%.
Daily Technical Analysis
The main trend is up according to the daily swing chart. However, momentum may be getting ready to shift to the downside based on yesterday’s closing price reversal top. This usually indicates counter-trend selling pressure.
A trade through $1220.70 will signal a resumption of the uptrend. A trade through $1192.70 will change the main trend to down.
The main range is $1244.70 to $1167.10. Its retracement zone at $1205.90 to $1215.10 is currently being tested. Trader reaction to this zone will help determine the near-term direction of the market.
The short-term range is $1167.10 to $1220.70. Its retracement zone at $1193.90 to 1.1187.60 is support. This zone stopped the selling at $1192.70 on September 11.
Daily Technical Forecast
Based on the early price action it looks as if the key support is a price cluster at $1207.10, $1206.70 and $1205.90.
A sustained move over $1207.10 will indicate the presence of buyers. If this creates enough upside momentum, we could see a test of the Fib at $1215.10, followed by yesterday’s reversal top at $1218.00 and the main top at $1220.70.
Taking out $1220.70 could trigger a breakout into a downtrending Gann angle at $1225.70.
A sustained move under $1205.90 will signal the presence of sellers. The daily chart is wide open under this level with the next major targets $1193.90, $1192.70 and $1189.50.
Basically, look for an upside bias to develop on a sustained move over $1215.10 and for a downside bias on a sustained move under $1205.90.
This article was originally posted on FX Empire
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