Technical Trading: Gold Tone Firm, Rising Bull ChannelBy Kira McCaffrey Brecht of Kitco News Monday February 10, 2014 8:17 AM (Kitco News) - Mon Feb 10— Traders can have their opinions, their hopes, and their targets. But, the gold market will go where it wants to go. The smartest and most profitable traders listen to the markets and trade what they see, not what they hope. Comex April gold futures are opening the week with a firm tone and a bid to the market. Last week a consolidative "inside day" session formed on the weekly chart, which served as a much-needed rest for the bulls following the strong gains registered throughout January. The market is rallying off "double bottom" type of support on the weekly chart at the $1,194-$1,182 zone, which represents major technical chart support for gold futures. Drilling down to the daily chart, a minor rising bull channel is seen off the Dec. 31 low. See Figure 1 below. Bull channel support lies around $1,253 and bull channel resistance comes in near $1,307. A channel represents the overall trend of the market, and as long as that channel support continues to hold in price pullbacks, the near term chart bias will remain bullish. Very short-term, gold bulls face resistance at $1,280.10, the Jan. 27 peak, which is the key short-term zone to monitor. If sustained declines are achieved above that ceiling, it would be a positive signal and would inject new bullish momentum into the market, with a target at the channel resistance zone. Looking at the short and medium term moving average picture, April gold remains under the influence of a bullish moving average crossover. On Jan. 28, the 20-day moving average crossed above the 50-day moving average, which is a positive signal. As long as the 20-day MA at $1,252.90 holds above the 50-day at $1,238.00 that bullish signal will be intact. Daily momentum is rising, but not yet overbought. The 9-day relative strength index stood at 64% early on Monday. Generally, the 70% zone or higher is considered to be overbought. Bottom line? The market is coming off a consolidative week. No technical damage was etched on the chart as the market held support at the prior swing low at $1,230.80, from Jan. 23, on the recent sideways/corrective phase. The bull channel remains intact, momentum is rising. The burden is on the bulls to conquer the $1,280 zone to open up the topside toward the $1,300 zone and higher. Kira Brecht is managing editor at TraderPlanet