Gold Daily Chart Indicators are Flashing Bearish Conditions – Gold risks falling to recent lows near $1,460, having carved out a bearish outside day candlestick pattern on Tuesday.
A bearish outside day occurs when prices end the day on a negative note, engulfing preceding day’s price action. The candlestick indicates impending bearish reversal when it appears after a notable price rise.
In Gold’s case, it indicates the continuation of the pullback from Oct. 10’s high of $1,517.
The bearish candlestick is backed by a below-50 reading on the relative strength index. The MACD has breached the ascending trendline below the zero line – a sign of strengthening bearish momentum.
All-in-all, the path of least resistance appears to be on the downside. On the way lower, key support levels are located at $1,474 (Oct. 11 low) and $1,459 (Oct. 1 low).
The bearish case will be invalidated if the metal closes Wednesday above the bearish outside day’s high of $1,499. As of writing, the yellow metal is trading at $1,482 per Oz.
