The pattern developing appears to be a "bear flag" that suggests further downside once the oversold condition of the market has unwound, which seems to be almost complete.
Gold is struggling to hold above support at 1250 in the face of surging equities making new all time highs and a rallying dollar holding above support at 80.50. Although there are increasing calls for a correction in equities, in our experience bull markets continue for longer than most expect and defy the negative voices, climbing a "wall of worry".
Support can be found at 1250-1252, 1237-1240, 1220-1225, 1210, 1200 and 1180. A break of 1180 would have serious bearish implications for gold and suggest a decline to 1000-1050 in the short term - this prospect now looks more likely and the break below 1250 gives us an indication of a likely return to 1180.
Resistance can be found at 1257-1260, 1268, 1274-1277, 1283, 1289, 1293-1296, 1304-1305, 1309, 1314-1315, 1319-1322, 1330-1332, 1340-1342, 1352-1354, 1392-1395, 1400, 1420 and 1435. The failure to break above the 65 week MA suggests that the intermediate down trend remains in play.
Today's video for subscribers looks at the recent trading in more detail and our strategy for our next trade.