Gold Price Futures (GC) Technical Analysis – Trend Changes to Up on Trade Through $1879.80

Gold futures are edging higher late Wednesday underpinned by hopes for more economic support for the U.S. economy and expectations of a dovish stance from the U.S. Federal Reserve.

Leading U.S. lawmakers reported substantial progress in hammering out COVID-19 relief aid as pressure mounted amid a surge in coronavirus cases in the worlds hardest hit country.

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The Federal Reserve was due to provide a playbook for its economic policy with policymakers set to conclude the final meeting of the year with investors expecting near zero interest rates and more bond-buying.

At 18:32 GMT, February Comex gold is trading $1859.20, up $3.90 or +0.21%.

Dovish Fed monetary policy is providing the longer-term support, while government fiscal stimulus is providing the short-term support.

Traders also said that gold‘s gains were capped by optimism over the rollout of the vaccines to fight COVID-19. Moderna Inc’s vaccine appeared set for regulatory approval this week after U.S. Food and Drug Administration staff endorsed it as safe and effective.

[fx-image src=/2020/12/Daily-February-Comex-Gold-9.jpg data-zoom-target=https://responsive.fxempire.com/cdn/n/n/_fxempire_/2020/12/Daily-February-Comex-Gold-9.jpg originalWidth=1920 ratio=1.99]Daily February Comex GoldDaily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $1879.80 will change the main trend to up. A move through $1820.00 will signal a resumption of the downtrend.

The short-term range is $1973.30 to $1767.20. Its retracement zone at $1870.30 to $1894.60 is resistance.

The minor range is $1767.20 to $1879.80. Its retracement zone at $1823.50 to $1810.20 is support.

The major support is the long-term support zone at $1780.50 to $1705.20.

[fx-article-ad]Daily Swing Chart Technical Forecast

The direction of the February Comex gold market into the close on Wednesday will be determined by trader reaction to the 50% level at $1870.30.

Bullish Scenario

A sustained move over $1870.30 will indicate the presence of buyers. Taking out $1879.80 will change the main trend to up and likely lead to a test of $1894.60. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under $1870.30 will signal the presence of sellers. This could trigger a break into $1823.50, followed by $1820.00 and $1810.20.

Taking out $1810.20 could trigger an acceleration to the downside with $1780.50 to $1767.20 the primary downside targets.

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