The Gold price remains in the downtrend. The price in the 30 minute chart as shown below explains how the trend remains down as we see lower lows and lower highs. The price is below the Ichimoku cloud. Whenever it approaches the cloud, we see selling pressures come back and push the price lower. This is what we expect to happen again. Critical short-term support level is at $1,290. Breaking below that level again will push the precious metal towards $1,275-80.
The downward move is not complete yet. I expect more downside pressures as long as the price is below $1,305. Breaking below $1,290 will confirm a bearish flag break and I will expect the price next to $1,280 at least. Breaking above $1,295 could push the Gold price towards $1,305.
The Gold price remains supported by the 38% Fibonacci retracement. The decline from $1,346 is currently in three waves. It means that if the price breaks above $1,326, our bearish scenario will be postponed. If the price breaks above $1,326, I would expect the Gold price to make a higher high above $1,346 towards $1,350-60. On the other hand, bears want to break below the Ichimoku cloud support at $1,280. Breaking below that level will increase the chances of success of our bearish preferred scenario. Concluding, $1,326 is crucial for our bearish scenario and $1,240 for the chances of bulls coming out as winners.
