December Comex Gold is trading lower shortly before the cash market opening. There was no follow-through to the upside after Friday’s strong rally. This indicates that it was probably short-covering rather than aggressive buying.

Based on Friday’s close at $1136.60, the direction of the market today will be determined by two points: $1142.40 and $1129.70. Holding between these two angles will produce a sideways market.

Look for a bullish tone to develop on a sustained move over $1142.40. This could create enough upside momentum to challenge a pair of downtrending angles at $1149.40 and $1152.90. The latter is the last potential resistance before the $1156.40 main top.

While the upside looks a bit easier, the downside appears to be crowded with the first angle at $1129.70, a downtrending angle at $1128.40 and a short-term 50% level at $1127.00.

The trigger point for a sharp break is $1127.00. This could trigger a break into the Fibonacci level at $1120.10. This is followed by another uptrending angle at $1113.70.

Friday’s news may have been bullish for gold, but investors were not willing to chase this market higher earlier today. If this market is setting up to move higher then buyers will likely be waiting for a pullback into a support zone so that they can get some value for their investing dollar.

Look for a bullish tone to develop on a sustained move over $1142.40 and a bearish tone to develop on a sustained move under $1129.70

Courtesy : www.fxempire.com