Gold futures are edging higher early Monday, mainly in reaction to a downtick in Treasury yields, a weaker U.S. Dollar and lower demand for riskier assets. Some traders feel that Friday’s weakness may have been an overreaction to the better-than-expected jobs data, and that the news may not be enough to sway the Federal Reserve from cutting its benchmark interest rate at its July 30-31 monetary policy meeting.

At 09:16 GMT, August Comex gold is trading $1408.10, up $8.00 or +0.57%.

We could be looking at a possible inside range today ahead of a speech by Federal Reserve Chairman Jerome Powell on Tuesday. Although he is likely to reiterate that the central bank is “data dependent” and not likely to make a decision about the direction of rates until policymakers have a look at all the data, some bullish traders appear to be holding out hope that he will tip his hand toward a rate cut.

Daily Technical Analysis

The main trend is up according to the daily swing chart, but momentum is showing signs of shifting to the downside because of the possible formation of a secondary lower top.

The main trend will change to down on a trade through $1384.70. A move through $1442.90 will signal a resumption of the uptrend.

The new short-term range is $1442.90 to $1384.70. Its retracement zone at $1413.80 to $1420.70 is potential resistance.

The intermediate range is $1323.60 to $1442.90. Its retracement zone at $1383.30 to $1369.20 is potential support.

The main range is $1274.60 to $1442.90. Its retracement zone at $1358.80 to $1338.90 is major support. It is controlling the longer-term direction of the market.

Daily Technical Forecast

Based on the early price action, the direction of the August Comex gold futures contract on Monday is likely to be determined by trader reaction to a pair of Gann angles at $1410.90 and $1395.60. This is because the market is currently trading inside of a triangle formation. Currently, the downtrending angle at $1410.90 is acting like resistance and the uptrending angle at $1395.60 is acting like support.

Bullish Scenario

A sustained move over $1410.90 will indicate the presence of buyers. This could lead to a labored rally with potential targets $1413.80, $1420.70 and $1426.90.

The rally opens up to the upside over $1426.90 with the next target angle dropping in at $1434.90. This is the last potential resistance angle before the minor top at $1441.00 and the main top at $1442.90.

Bearish Scenario

A sustained move under $1395.60 will signal the presence of sellers. This could trigger an acceleration to the downside with the next target the main bottom at $1384.70 and the 50% level at $1383.30. The latter is the trigger point for an acceleration into the Fibonacci level at $1369.20.