- Gold is flashing red after Friday's bearish outside day candle.
- The 4-hour chart shows the rising channel breakdown and bearish indicator divergence.
Gold is currently trading at $1,508 per Oz, representing a 0.29% drop on the day.
The yellow metal created a bearish outside day candlestick pattern on Friday, which occurs when the trading range engulfs preceding trading day's high and low.
That candlestick pattern is considered an early sign of bullish-to-bearish trend change, especially if it appears following a notable rally, which is the case here.
Further, the 4-hour chart shows a bearish divergence of the relative strength index (RSI) and a rising channel breakdown.
Hence, a pullback to the Aug. 13 low of $1,480 looks likely. The bearish case would weaken if prices find acceptance above Friday's high of $1,528.
Trend: Pullback likely
- R3 1549.55
- R2 1538.6
- R1 1526.1
- PP 1515.15
- S1 1502.65
- S2 1491.7
- S3 1479.2
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