Gold (GC) Futures Technical Analysis – January 30, 2014 Forecast …
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April gold is trading lower but the main trend is still up on the daily chart. The market is trading inside yesterday’s range, suggesting trader indecision. Bullish traders seem to be holding out hope that the emerging market problems will lead to lower equity prices and a drop in the U.S. Dollar.
The easing of tensions in the stock market overnight and the stronger dollar are helping to push gold prices lower. The inside range suggests impending volatility. The wide short-term range formed between $1280.10 and $1248.00 makes it difficult to buy strength and sell weakness. Therefore, investors should watch the pivot price created by this range at $1264.05 for direction. Since the market is trading below this price prior to the U.S. opening, investors have to conclude there is a bias to the downside.
Daily April Gold
Crossing a major uptrending angle at $1262.30 and the pivot price at $1264.05 will be signs of strength and will put the market in a position to challenge the recent top at $1280.10.
Sustaining the move on the bearish side of the pivot at $1264.05 should keep downside pressure on the market, but support areas have to be taken out with conviction in order to paint a bearish picture and trigger an acceleration to the downside. The first price level to watch is $1255.45, followed by an uptrending angle at $1250.80. Gold is likely to accelerate to the downside once the Fibonacci level at $1249.63 is taken out with conviction. This could trigger a sharp break into $1240.80.
Look for an early bias to the downside with the market holding steady between a pair of 50% level s at $1264.05 and $1255.55. Traders seem to be waiting for confirmation from outside markets to make their next move. A strong rally in the dollar and equity markets today should put downside pressure on gold.
If the dollar can’t rally in the wake of another round of Fed tapering and the emerging market problem flares up once again then gold should rebound to the upside. The key number to watch is $1264.05.
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Gold (GC) Futures Technical Analysis – January 30, 2014 Forecast …
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