- Gold is currently trading at $1,220, having clocked a high of $1,228 yesterday. The repeated failure to beat the 100-day exponential moving average (EMA) could end up killing the recovery rally from the Nov. 13 low of $1,196.
- The metal created an inverted bearish hammer at the 100-day EMA yesterday, indicating a weakening of bullish pressures.
- Over on the 4-hour chart, the relative strength index (RSI) has diverged in favor of the bears. Further, the MACD has produced a bearish crossover.
- The metal could drop to $1,216 (38.2% Fib R of the recent recovery rally). A break below that level would open up downside toward $1,208 (61.8% Fib R).
- The bullish move, however, would resume if prices find acceptance above the 100-day EMA, currently at $1,225.
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