Gold prices continue to trade sideways with no clear short-term direction. The chart below shows the triangle is being formed. If prices break above 1326, then we should expect the upward bounce to complete near 1,350-60. If the triangle breaks downwards below 1,304, then expect 1,290-1,280 to be tested.
The short-term trend is neutral. Intermediate-term trend is downward as prices trade below the red downward sloping trendline. If this resistance is broken upwards we should anticipate a move to challenge the 1,375 highs. This line is now at 1,325-30. This level could be used as a stop reversel level. We prefer being short below that level and we could reverse to long if prices break above that level.
The longer-term picture remains unchanged. Strong resistance is found at 1,355-60 and the Head-and-Shoulders pattern is always on our mind as a bearish potential. If the neckline is broken we add to short positions. This confirmation will come if prices break below the 1,270-75 price level. Concluding we have a small short position with 1,330 stop. Wу should open new short positions if the neckline breaks with 1,150-1,200 target.
