Gold Price Futures (GC) Technical Analysis: Struggling to Surpass the $1798.50-$1822.60 Retracement Zone

Gold futures are trading lower soon after the midpoint of Friday's session after an unexpectedly robust U.S. job market report allayed fears of a recession and dashed rumors that the Federal Reserve will abandon its aggressive monetary policy tightening.

At 18:05 GMT, the Comex gold price for December decreased $15.10, or 0.84 percent, to $1791.80. The SPDR Gold Shares ETF (GLD) has fallen $1.88, or 1.13 percent, to $165.29.

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Non-Farm Payrolls grew by 528,000 last month, which above the estimates of the Dow Jones by 258,000. Similarly, pay growth increased, with average earnings increasing 0.5% for the month and 5.2% over the previous year. The unemployment rate has dropped to a pre-pandemic low of 3.5%. The stronger-than-expected result demonstrated that the United States is probably not in a recession.

On the assumption that the U.S. economy was faltering, gold dealers had priced in a shift by the Fed from hawkish to slightly dovish for around a week. The economy is robust enough to withstand an additional 75 basis point rate hike at the Fed's next meeting on September 21.

This may be sufficient to temporarily restrict gold prices, although some traders may await confirmation from Wednesday's U.S. consumer inflation report.

The daily swing chart indicates that the primary trend is upward. A transaction above $1812.00 will indicate a continuation of the uptrend. A breach of $1727.00 will reverse the tendency to decline. Even the modest tendency is upward. A transaction above $1770.00 will reverse the modest trend up. Consequently, momentum will turn to the negative. The intermediate price range is between $1900.80 and $1696.10. The resistance zone between $1798.50 and $1822.60 is its retracement zone. It ended the rally at $1812.00 on Thursday.

The range for the first minor is $1770.00 to $1812.00. Its pivot point at $1791.00 represents the initial downward objective. The range for the second minor is $1727.00 to $1812.00. The pivot point is the next negative target at $1769.50. The third pivot price objective is $1754.10

The direction of the December gold futures contract on the Comex will likely be dictated by trader reaction to a pair of 50 percent levels located at $1798.50 and $1791.00 as of Friday's closing bell. Expect the upward bias to persist on a persistent rise over $1798.50, and the negative bias to emerge on a sustained decline below $1791.00.