December Gold Futures: Intraday Short Possibility

December gold futures are showing tentative strength early on in the U.S. session. Concerns over a weakening dollar and the flagging U.S. e

Written by: Dime Levov • Monday, August 21, 2017 • 1 min read

• Last updated: Monday, August 21, 2017

December gold futures are showing tentative strength early on in the U.S. session. Concerns over a weakening dollar and the flagging U.S. equities markets have caused many traders to turn attention to the bullion market. As covered a bit earlier by my colleague Skerdian, we are at a crucial time for the gold trade.

No matter if you are trading CFDs, forex or outright futures, gold is a consistent provider of opportunity. Let’s see if we can identify a few key areas in today's December gold futures market.

Technicals

The electronic session for December gold has produced a nice 135 tick range. After an initial test under Friday’s low on the open, we have seen a pronounced rally.

December Gold Futures- Test And Rally

A few key technicals:

Rejection under last Friday’s low of 1289.1 is further evidence of the cautionary stance taken by investors. Right now, safety has value.
Key psyche level of 1300.0 is likely to see heavy participation
Friday’s swing high of 1307.0 will act as topside stop loss area for short sellers
Resistance at 62% (1300.1) and 78% (1303.1) of Friday’s range are primed areas to short for the remainder of the U.S. session.

Bottom Line: I like big, round numbers. It seems that more often than not they establish the trading ranges facing a product. For this week, the 1300.0 for December gold futures will be an area of interest.

A premium short day trade level is from 1303.1 with a concrete stop above Friday’s high at 1307.0. This sets up a very reasonable 1:1 ratio play with rotation back towards today’s value area.