- Gold is looking south with the 4-hour chart reporting a bearish crossover.
- A drop to the 50-day MA support looks likely. The bear case would weaken above $1,517.
Gold is currently trading in a sideways manner around $1.498, having hit a high of $1,512 on Monday.
The 4-hour chart shows the 50-period moving average has crossed below the 200-period moving average. That bearish crossover indicates the path of least resistance is to the higher side.
On the downside, the key support is seen at $1,472 (50-day moving average).
The bearish case would weaken if prices find acceptance $1,517 (Aug. 30 low). That would invalidate the double top bearish reversal pattern confirmed on Sept. 6.
As of now, however, a move above $1,517 looks unlikely. It is worth noting that the yellow metal failed to hold onto gains above $1,510 on Monday despite the Saudi attacks and the resulting risk-off tone. So, it seems safe to say that the bulls are exhausted and there is scope for a deeper pullback to the 50-day MA.
4-hour chart
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Trend: Bearish
Technical levels
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