Comex Gold Futures (GC) Technical Analysis – August 20, 2015 Forecast
December Comex Gold futures are trading higher shortly before the cash market opening as aggressive investors continue to bet against a September interest rate hike by the Fed. Declines in global stock markets are also providing a boost to the metal’s safe-haven appeal.
Even though the Fed minutes released on Wednesday said that most Federal Reserve officials thought economic conditions needed for a rate hike were “approaching”, gold traders reacted as if it wasn’t a done deal mostly because inflation remains below the 2.0% mandate.
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Technically, the main trend turned up on the daily swing chart on Wednesday when gold rallied through the August 13 main top at $1126.30. The new main bottom is $1108.50. Also in a sign of strength, gold accelerated through a long-term downtrending angle from the $1207.30 main top. This angle is at $1119.30 today.
The main range is $1207.30 to $1073.70. Its 50% level at $1140.50 is currently being tested. Based on the current price at $1138.90, the direction of the market today will be determined by trader reaction to the pivot.
A failure to overcome the pivot at $1140.50 will indicate the presence of sellers. This could trigger a break into a pair of angles at $1124.50 and $1116.50. The best support is a Gann angle cluster at $1112.50 to $1111.70. Breaking this price cluster could be a sign that the rally is failing.
A sustained move over the pivot at $1140.50 will signal the presence of buyers. The first upside objective is a steep uptrending angle at $1149.70. This is followed by the Fibonacci level at $1156.30 and a long-term downtrending angle at $1163.30.
Watch the price action and read the order flow at $1140.50. This will tell us whether the bulls or the bears are in control.