Technical Levels To Watch For June Gold Futures

June gold futures are attempting to close in the green for the third consecutive session. With only four hours left in the electronic session, price is just above Monday’s high at the 1292.0 handle. Buyers and sellers are duking it out in anticipation of U.S. monetary policy and the verbiage of Wednesday’s FOMC minutes.

Over the weekend, I outlined a trading a plan in the Scalping 101 series. The trade went unelected in the wake of heavy selling on the weekly open from metals traders. If nothing else, it was a look at the different components of a scalping plan.

We will see how this market unfolds as attentions shift toward FED monetary policy.

Gold Technicals

On the daily time frame, there are several levels of topside resistance setting up. In the event that they come into play, a short trade may be in the offing.

Here are the levels to watch as the FOMC minutes approach:

• Resistance(1): 38% Retracement of Current Wave, 1298.4
• Resistance(2): Psyche Level, 1300.0
• Support(1): Swing Low, 1281.2

Bottom Line: As of press time, June gold futures are non-commital. In order to capitalize upon a test of topside resistance, I have sell orders queued up from 1298.1. Using an initial stop at 1301.1, this trade produces 30 ticks when implementing a conservative 1:1 risk/reward management plan.

As the FOMC minutes approach, anything can happen. However, market consolidation is the most likely scenario. With a bit of luck, this short trade recommendation will go live by the end of the Tuesday session.