Gold technical analysis: Risks skewed to the downside after failed breakout


  • Gold's daily chart shows a failed falling channel breakout. 
  • Monday's drop confirmed a bearish candlestick reversal pattern. 
  • The yellow metal could drop to support at $1,481. 

Gold is looking south, having witnessed a failed breakout in the previous two trading days.

The yellow metal closed at $1,504 on Friday, confirming an upside break of a falling channel, represented by Sept. 4 and Sept. 24 highs and Sept. 10 and Oct. 1 lows. 

The breakout was confirmed with a Gravestone Doji and looked weak and was short-lived, as prices fell 0.80% on Monday. 

Put simply, Monday's close at $1,490 activated twin bearish cues: a failed breakout and a Gravestone Doji reversal. 

Gold, therefore, is likely to face selling pressure on Tuesday. The yellow metal is currently trading at $1,491 per Oz and could drop to support at $1,481 (Oct. 22 low). 

The bearish case would be invalidated if prices rise above Monday's high of $1,508.

Daily chart

Trend: Bearish

Technical levels

XAU/USD

Overview
Today last price 1491.71
Today Daily Change -0.79
Today Daily Change % -0.05
Today daily open 1492.5
 
Trends
Daily SMA20 1494.39
Daily SMA50 1504.94
Daily SMA100 1464.43
Daily SMA200 1381.75
 
Levels
Previous Daily High 1508.23
Previous Daily Low 1490.1
Previous Weekly High 1517.92
Previous Weekly Low 1481.05
Previous Monthly High 1557.03
Previous Monthly Low 1464.61
Daily Fibonacci 38.2% 1497.03
Daily Fibonacci 61.8% 1501.3
Daily Pivot Point S1 1485.66
Daily Pivot Point S2 1478.81
Daily Pivot Point S3 1467.53
Daily Pivot Point R1 1503.79
Daily Pivot Point R2 1515.07
Daily Pivot Point R3 1521.92

 

 

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