Gold Price Futures (GC) Technical Analysis – Trader Reaction to Minor 50% Level at $1954.80 Sets the Tone

 

Gold futures closed lower on Thursday but up from its low of the session as investors battled a number of factors including U.S. economic data and outside market influences.

Earlier in the session, gold fell over 1%, as positive economic data elevated hopes for a quick recovery while dampening the investment appeal of the precious metal.

On Thursday, December Comex gold futures settled at $1937.40, down $11.60 or -0.60%.

On the data front, a drop in U.S. jobless claims reported Thursday and positive manufacturing data reported earlier in the week are taking some shine off gold. A weaker Euro is also weighing on dollar-denominated gold by driving up thU.S. Dollar Index.

U.S. weekly jobless claims fell below 1 million last week for the second time since the pandemic started, but did not signal a strong recovery in the labor market because the drop largely reflected a change in the methodology used to address seasonal fluctuations in data. Earlier in the week, a report showed U.S. manufacturing activity accelerated to a near two-year high in August.

Daily Swing Chart Technical Analysis


The main trend is up according to the daily swing chart, however, momentum is trending lower based on the formation of two secondary lower tops at $2001.20 and $2024.60. A trade through $1908.40 will change the main trend to down.

The minor range is $1908.40 to $2001.20. Its 50% level at $1954.80 is potential resistance.

The short-term range is $2089.20 to $1874.20. Its retracement zone at $1981.70 to $2007.10 is resistance. This zone stopped the rally at $2001.20 earlier in the week.

The main support is the $1889.70 to $1842.60 retracement zone. This zone stopped the selling at $1874.20 on August 12.

 

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