Gold price continues to trade below short-term resistance and has potential for a short-term bounce, justified by the bullish divergence warning by the RSI.
Blue lines - bullish divergence
Green rectangle - major resistance area (previous support)
Gold price broke below the important $1,290-80 support area. A back test towards this area that is now resistance is very possible as we have some bullish divergence warnings from the RSI in the 4 hour chart. This is not a reversal confirmation but just a warning. Price from current levels could bounce to $1,280-$1,300 area. Key for this scenario is for the RSI to hold above the blue upward sloping support trend line. Breaking below it will cancel any bounce potential. Our medium-term target remains at $1,260-50 after breaking below $1,280.
