Gold Technical Analysis and Near-Term Outlook

Gold is trading in a narrowing range that forms a coil pattern. Coils reflect indecisiveness and are not the most reliable patterns. Even so, they generally break in the direction of the prior move, in this case, down.

Today’s decline to $1927.2 challenged the lower trend line of the coil and fulfilled the smaller than (0.618) target of the wave down from $2024.6. This is bearish and suggests that the move down should continue to the $1888 equal to target. This is in line with the smaller than (0.618) target of the primary wave down from $2089.2. Settling below $1888 will call for a more significant decline.

Nevertheless, the move up to $2001.2 earlier in the week fulfilled the smaller than target of the wave up from $1874.2. This wave positive because this wave connects to $2059 and higher. The coil pattern may be building a bullish base, but until gold settles above $2001, the near-term outlook will continue to lean bearish.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.

Gold Near-Term Outlook

The near-term outlook for December gold futures leans bearish. Gold initially rose to $1980 as expected today. However, this level, which is in line with the 62 percent retracement of the decline from $2024.6 and the 20-day moving average, held on a closing basis. Also, the subsequent move down from today’s $1987.0 high fulfilled the $1915 smaller than (0.618) target of the wave down from $2024.6. Therefore, odds favor a continued decline, and a move below $1915 will clear the way for $1891 and lower.

Nevertheless, trading has been erratic for the past few days. So far, the move up from $1914.7 has held the 38 percent retracement of the decline from $1987.0. However, should gold rise a bit higher first, look for resistance at $1961 to hold. Closing above this would shift near-term odds in favor of key resistance at $1997. This is the equal to (1.00) target of the wave up from $1908.4 and, more importantly, the smaller than target of the wave up from $1874.2. Settling above $1997 would call for gold to make a push for at least $2023 and likely higher next week.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.

Gold Near-Term Outlook

December gold’s move up today is most likely corrective of yesterday’s decline. Near-term odds continue to favor a larger move down because of the daily and weekly reversal patterns and signals that were confirmed during the pullback from the $2089.2 swing high. A move below $1942 early tomorrow will increase odds for challenging $1932 again. This is the 62 percent retracement of the rise from $1874.2, a close below which will call for $1907 and then the key objective at $1892. Settling below $1892 will call for a much more significant test of support before gold tries to rise again.

Nevertheless, based on the intra-day waves up from $1928.9, there is a good chance for a test of $1975 and possibly $1988 before gold challenges $1932 again. Resistance at $1988 is expected to hold. Closing above this will call for $2011 and possibly $2022. The $2022 threshold is most important because this is the smaller than (0.618) target of the wave up from $1874.2. Settling above $2022 would imply that the corrective move down is most likely complete and that the move up will begin to extend toward new highs again.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.

Gold Near-Term Outlook

Gold was due for a significant test of support, the beginning of which took place on Tuesday. The move down from $2089.2 retraced just over 50 percent of the move up from $1690.1. While this aggressive move down was bearish for the near-term outlook, the move up during the past two days implies that the decline will probably prove to be corrective of the larger scale move up.

It is too soon to call for the correction to be complete. However, based on today’s move up to fulfill the $2073 smaller than (0.618) target of the primary wave up from $1874.2, a larger test of resistance is expected tomorrow. Rising above $1973 will clear the way for $1991 and likely $2007. The $2007 objective is the equal to (1.00) target of the wave up from $1874.2 and the 62 percent retracement of the decline from $2089.2. Settling above $2007 would signal that the correction might already be complete and would clear the way for $2020, $2040, and $2065 early next week.

Nevertheless, given the number of reversal signals that were confirmed on the daily and likely the weekly chart tomorrow, there is a good chance that $2007 will hold, at least initially.

Conversely, should $2073 continue to hold and upon an early move below $1936 tomorrow, look for a test of key near-term support at $1913. Settling the week below $1913 will call for prices to fall toward $1885 and ultimately major support at $1845 early next week.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.

Gold Near-Term Outlook

The December 2020 gold futures contract finally settled above the crucial $2050 target today. This is bullish for the near-term outlook and clears the way for at least $2091 and possibly $2130. These are the next potential stalling points because they are the larger than (1.618) target of the primary wave up from $1690.1 and the intermediate (1.382) target of the primary wave up from $1458.8, respectively.

The daily RSI and KasePO momentum oscillators are overbought. Otherwise, there are no confirmed bearish reversal patterns, signals, or setups that call for the move up to stall before reaching at least $2091.

Nevertheless, should gold fall below $2049 look for a test of $2021. This is the 38 percent retracement of the move up from the last major intra-day swing low of $1927.5. Support at $2021 is expected to hold. Settling below this will call for a deeper test of support where $1990, the 62 percent retracement, is most important for the near-term outlook.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.

Gold Price Forecast

The long-term outlook for gold remains bullish. However, August gold futures formed a double top at yesterday’s $1974.9 swing high. Gold had also formed daily high wave candlesticks (or long-legged dojis) earlier in the week that implied the move up was nearing exhaustion. Today’s bearish engulfing line, a KCDpeak, and a KasePO PeakOut (confirmed overbought momentum oscillator signals) call for a test of $1929 and likely $1900 before the move up continues.

The $1929 objective is the 62 percent retracement of the rise from $1900.2. This target was tested and held today when gold fell to $1930.0. Therefore, it may prove to be strong support.

The $1900 target is in line with the $1900.2 confirmation point of the double top. Settling below $1900 will confirm a larger reversal is underway and would call for a deeper correction to $1859 and possibly to the double top’s $1826 target ($1900.2 – ($1974.8 – $1900.2)).

Nonetheless, the move down is most likely corrective because ultimately the larger scale waves, sub-waves, and compound waves up from $1454.8 call for $2003. Should gold hold $1929 and overcome $1958 look for a test of $1976. Closing above this will call for gold to reach $2003 before possibly stalling again.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.

Gold Price Forecast

Gold’s move up finally accelerated this week after breaking higher out of a rectangle pattern on June 30 and then a throwback to test the $1790 breakout point on July 14. The move up has easily overcome targets around $1840 and $1871 this week but stalled this afternoon near $1898. Based on the wave structure, $1898 is a relatively minor target, and odds still favor a move above this to the next major objective at $1912. The $1912 objective is most important because it is the intermediate target of the first wave up from $1694.9 and is in line with the rectangle’s $1909.6 target ($1789 + ($1789 – $1668.4) = $1909.6). Therefore, once $1912 is met another modest test of support is expected before the move up continues.

There are no confirmed bearish reversal patterns or signals that call for a major test of support before reaching $1912. Nevertheless, the daily RSI and KasePO momentum oscillators have risen into overbought territory. This warns that a test of support will probably take place soon and suggests that $1912 will hold, at least initially.

The small move down from the $1898 confluence point also warns that a small test of support might take place before gold reaches $1912. Support at $1872 is expected to hold and $1853 is key for the near-term. Settling below $1853 would call for $1831 and possibly $1808 before gold rises toward $1912 again.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.

Gold Price Forecast

Gold’s move up has been lackluster after breaking higher out of a rectangle pattern on June 30. The move up fulfilled an important target at $1820, but since then, a throwback to test the breakout point of the rectangle around $1790 has taken place. Throwbacks are common and on Tuesday the correction down from the $1829.8 swing high stalled at $1971.1. However, the subsequent move back up stalled at $1819.5 and today’s price action fulfilled the smaller than (0.618) target of the wave down from $1829.8. Therefore, near-term odds favor a test of at least $1781 and possibly $1767 before the move up continues. There are the equal to (1.00) and intermediate (1.382) targets of the wave down from $1829.8, respectively.

Support at $1767 is also in line with the 38 percent retracement of the rise from $1671.1. This target is expected to hold. Settling below $1767 will significantly dampen odds for a continued rise to target above $1820 during the next few weeks. This will also clear the way for $1753 and possibly a test of key lower support at $1732.

Conversely, the long-term outlook remains bullish, so once $1781 is met odds for another test of $1820 will begin to increase. Settling above $1820 will open the way for the next leg of the move up to $1837 and higher.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial

Gold Price Forecast

Gold finally broke higher out of the rectangle pattern that began to form in mid-April. A sustained close above $1790 confirmed the break high and the next objective around $1820 has already been met. The move up stalled at $1829.8, and today’s decline suggests a test of the $1790 breakout point might take place before the move up continues. A throwback to the breakout point of a pattern like a rectangle is common. Therefore, $1790 is expected to hold.

The long-term outlook for gold remains bullish and a close back above $1820 will clear the way for $1836 and higher. The next major objective above $1820 is $1912. This is a highly confluent wave projection and is in line with the rectangle’s $1909.6 target ($1789 + ($1789 – $1668.4) = $1909.6).

Should gold close below $1790, odds for a continued rise during the next few days will be significantly dampened. Key near-term support is $1770. Settling below $1770 would reflect a bearish shift in sentiment and imply that the recent move above $1790 was a false break higher out of the rectangle pattern.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.

Gold Price Forecast

Gold closed above $1790 on June 30. This was bullish for the long-term outlook because $1790 is the upper threshold of a rectangle pattern that prices have been trading in since mid-April. Based on the wave formations, the move up should extend to at least $1820 and likely much higher in the coming weeks and possibly months. Nevertheless, yesterday’s close back below $1790 dampens near-term odds for a continued rise.

Today’s small move up was somewhat encouraging for gold bulls in that it overcame an intra-day swing high of $1785.5. This negated a wave down from $1807.7 that called for a deeper test of support. Tomorrow, look for a test of $1800, a close above which will substantially increase odds for a move to $1820 early next week.

Nevertheless, yesterday’s move down confirmed a bearish Slow Stochastic divergence and today’s move up held the 62 percent retracement of the decline from $1807.7. Therefore, there is still a reasonable chance for a deeper test of support before the move up continues. Falling below $1766 will call for $1753, which is expected to hold. Key near-term support is $1753. Settling the week below this would call for $1738 and possibly $1724. Taking out $1724 would imply that the close above $1790 was a false break higher out of the rectangle. This is doubtful but would suggest the move up is failing.

This is a brief analysis for the next day or so. Our weekly Metals Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key COMEX precious metals futures contracts and LME Non-Ferrous (Base) metals, spot gold, the gold/silver ration, and gold ETFs. If you are interested in learning more, please sign up for a complimentary four-week trial.