Gold technical analysis: Vulnerable to sell-off after bearish outside day


  • Gold created a bearish outside day candlestick pattern on Tuesday. 
  • The daily chart indicators are flashing bearish conditions. 
  • The yellow metal may face selling pressure and drop to $1,460 in the short term.

Gold risks falling to recent lows near $1,460, having carved out a bearish outside day candlestick pattern on Tuesday.

A bearish outside day occurs when prices end the day on a negative note, engulfing preceding day's price action. The candlestick indicates impending bearish reversal when it appears after a notable price rise.

In Gold's case, it indicates the continuation of the pullback from Oct. 10's high of $1,517.

The bearish candlestick is backed by a below-50 reading on the relative strength index. The MACD has breached the ascending trendline below the zero line – a sign of strengthening bearish momentum.

All-in-all, the path of least resistance appears to be on the downside. On the way lower, key support levels are located at $1,474 (Oct. 11 low) and $1,459 (Oct. 1 low).

The bearish case will be invalidated if the metal closes Wednesday above the bearish outside day's high of $1,499. As of writing, the yellow metal is trading at $1,482 per Oz. 

Daily chart

Trend: Bearish

Technical levels

XAU/USD

Overview
Today last price 1482.12
Today Daily Change 1.06
Today Daily Change % 0.07
Today daily open 1481.06
 
Trends
Daily SMA20 1499.64
Daily SMA50 1507.39
Daily SMA100 1448.63
Daily SMA200 1372.57
 
Levels
Previous Daily High 1497.95
Previous Daily Low 1477.29
Previous Weekly High 1516.85
Previous Weekly Low 1474.2
Previous Monthly High 1557.03
Previous Monthly Low 1464.61
Daily Fibonacci 38.2% 1485.18
Daily Fibonacci 61.8% 1490.06
Daily Pivot Point S1 1472.92
Daily Pivot Point S2 1464.77
Daily Pivot Point S3 1452.26
Daily Pivot Point R1 1493.58
Daily Pivot Point R2 1506.09
Daily Pivot Point R3 1514.24

 

 

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