August Comex Gold futures are called lower based on the pre-market trade. The price action suggests the market may still be trying to form a support base. It also suggests there are no real buyers. The size and duration of the recent rallies suggests short-covering.
The main trend is up on the daily swing chart, but momentum is on the downside. The short-term range is $1162.10 to $1205.70. Its retracement zone at $1183.90 to $1177.80 is currently controlling the short-term direction of the market.
On the downside, the first support is an uptrending angle at $1170.60. This is followed by $1166.30. This is the last uptrending angle before the $1162.10 main bottom.
On the upside, the key area to watch today is a price cluster at $1177.80, $1178.80 and $1179.10. Overcoming this area will be a sign of strength.
A sustained move over $1179.10 could trigger a rally into the 50% level at $1183.90. This is followed by another 50% level at $1188.30 and a downtrending angle at $1189.70.
The trigger point for a strong upside breakout is $1189.70. Taking out this level with conviction could trigger a move into $1197.50.
Look for a bullish tone to develop over $1179.10 and a bearish tone under $1170.60. Trading inside these prices will likely lead to a sideways, or choppy, two-sided trade.
