Comex Gold Futures (GC) Technical Analysis – August 11, 2014 …

Comex Gold Futures (GC) Technical Analysis – August 11, 2014 …

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December Comex Gold futures posted a potentially bearish closing price reversal top on Friday after slamming into a cluster of resistance. The typically leads to a 2 to 3 day break equal to at least 50% of the last rally.

Daily December Comex Gold

The short-term range is $1347.50 to $1281.00. The retracement zone formed by this range is $1314.30 to $1322.10. On Friday, the market briefly penetrated the upper or 61.8% level before strong selling pressure drove the market beyond the Fibonacci and 50% level.

Since bottoming at $1281.00 on August 1, gold had been moving up at a pace of close to $8.00 per day. On Friday, the market kept up this pace, but the weak close means it will have to trade up to $1329.00 to maintain the pace. It also means it may break into the next angle moving up $4.00 per day at $1305.00.

A new short-term range has formed between $1281.00 and $1324.30. If there is follow-through selling pressure today then look for a move into its retracement zone at $1302.60 to $1297.50.

Should the selling pressure be strong enough, watch for a test of additional support angles at $1293.00, $1289.70 and $1287.00.

On the upside, besides the Fib level at $1322.10 and last week’s high at $1324.30, additional downtrending angles drop in at $1325.50 and $1336.50.

Friday’s sell-off gives gold a slight downside bias today. If the selling pressure is strong enough then watch for a pullback over the next 2 to 3 days into at least $1302.60 to $1297.50. Since the main trend is up on the daily chart, buyers may step in to defend this area.

Last week’s rally was triggered by two events, the Russians gathering on the Ukraine border and Obama’s authorization of airstrikes against Iraqi militants. These two events have already been priced into the market.

The rally looks like it was fueled by short-covering and aggressive hedging. If buyers really want to get long, they are not going to buy strength. They are going to buy a pullback into a value zone. Watch the price action and order flow on a pullback into the $1302.60 to $1297.50 zone because investor reaction to this zone will likely set the tone for the week. 

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Comex Gold Futures (GC) Technical Analysis – August 11, 2014 …

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