- Gold is trading just above flat in a lacklustre session due to a US holiday.
- Leading into next week there is a bearish divergence set up on the 4-hour chart.
Gold 4-hour chart
Price action has been slow on Friday due to the bank holiday in the US as the nation celebrates independence day. This week has been an interesting one as there has been some good economic data but some very bad coronavirus news in the US.
Despite the equities markets moving higher, gold also managed to push higher too. However, there are some signs that the momentum may be slowing. On the 4-hour chart below, the Relative Strength Index indicator is showing a lower high while the price made a higher wave high. This signal is called a bearish divergence and means the bull trend could be running out of steam.
A confirmation of this signal would be a bearish break of the USD 1764 per troy ounce level. This could also make a lower high lower low wave sequence. Overall the market is still in a firm uptrend and could just need a pullback before a run to higher levels. The next major resistance is still the USD 1800 per troy ounce level.
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