On the chart –
Gold after suffering the breakdown continued its downtrend creating lower highs and lower lows formation. The red trendline was respected suggesting the upside may now remain capped and rallies are getting sold into. With global risk-on trade having a fresh life its difficult for gold to hang on at high levels unless trend changes again. On the chart –
1. Bulls remain on sidelines as the breakdown was tested and respected excepting scalp trading.
2. Gold closed below the support line, till this is held it can move towards $1284. Once this is crossed it can slide to $1273. And if this is broken it can fall further to $1260.
bets remain out of contention until gold resumes the uptrend by giving a positive breakout from the flag.
view – Bears continued the assault as they eroded the prices further creating a new weekly low along with nibbling away the gains by $1. Bears were active throughout the week as the prices were pegged back from highs every time adding more strength to the trend. Fundamentals seem to be working in favor of bears and till the support of the breakdown line is held prices can fall further towards the next major of $1236-$1240.
On larger terms, Gold continues to remain 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 $1289 for the targets of $1284 and $1273 with a stop loss placed above $1298. Longer term target $1260.
A sell-on-rallies can be useful under current scenario.