On the chart –
Gold made lower highs and lower lows formation again indicating the strength on the upside might be limited. The pattern breakdown continues to play as it was retested again in the last week and got respected. We have 2 scenarios –
1. Bulls remain sidelined as they failed to breakout excepting scalp trades though the closing can be eyed upon as a first mark towards bullishness.
2. Gold closed below the support, till this is respected it can move towards $1284. If this is taken out it can fall to $1273. And if this is breached it can slide towards $1260.
view – Bulls can have some cheer as they finally had a good week and the closing was on their favor though lot has to be done to get the trend back to bull. Breakout is required for bulls to over power bears again.
view – Bears can also have some cheer as they created a new low but failed to hang on to it. The formation of lower highs and lower lows continue to aid the bears to keep the trend intact. The pattern breakdown continues and new lows can be expected till it is respected with next major being $1236-$1240.
On larger terms, Gold remains and prices are expected to head lower.
Possible trades are on both sides, gold can be bought once it breaks out of the flag or at the bottom of the flag/channel.
Gold can be sold under $1284 for the targets of $1273 and $1260 with a stop loss placed above $1296.
A sell-on-rallies can be useful under current scenario.