Comex Gold Futures (GC) Technical Analysis – August 21, 2014 …

Comex Gold Futures (GC) Technical Analysis – August 21, 2014 …

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Sellers took control of the December Comex Gold market after detecting a somewhat hawkish tone in the U.S. Federal Reserve’s July minutes. The news helped drive up U.S. interest rates, making the U.S. Dollar a more desirable investment. Since gold is dollar denominated, the rise in the dollar helped dampen foreign demand. The strong surge in the equity markets also hurt demand for gold.

Daily December Comex Gold

Technically, the main trend is up on the daily chart according to the swing chart. The trend will turn down if $1281.00 is taken out with conviction. The break through a pair of uptrending angles at $1297.70 and $1295.00 today, puts the market in a weak position. This makes the swing bottom vulnerable.

The main range is $1241.70 to $1347.50. The retracement zone formed by this range is $1294.60 to $1282.10. On Wednesday, the market straddled the upper, or 50% level at $1294.60. A sustained move under it should trigger a break into the lower or Fibonacci level at $1282.10.

There may be a technical bounce caused by profit-taking if $1282.10 to $1281.00 is tested today. If the selling momentum overcomes these levels then look out below since the next support is an uptrending angle at $1269.70.

If there is no follow-through to the downside then watch for traders to try to drive the market back above the uptrending angles at $1295.00 and $1297.70. This will indicate that buyers are still hanging around. This could mean a rally into the nearest resistance angle at $1306.30.

Watch the price action and order flow around $1295.00 to $1297.70. Trader reaction to this zone should set the tone for the day. Outside markets should also influence gold prices today. An overbought U.S. Dollar and stock market could lead to a rally in gold if investors decide to take profits on the Greenback and in the equity markets.  

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Comex Gold Futures (GC) Technical Analysis – August 21, 2014 …

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