Gold pulled back towards our support area of $1,270 yesterday and is now trading $10 higher. The trend remains bearish in the short term, and this is the opportunity to go long for aggressive traders as I mentioned a few days back when the price was at $1,293. Personally I prefer to be neutral in Gold.
Black line -support
Yellow area - oversold stochastic
Gold remains above the Kumo on the 4-hour chart but has broken below the kijun- and the tenkan-sen indicators providing a bearish signal. However, the price remains above the cloud yet and the stochastic oscillator is turning upwards from oversold levels. Short-term support at $1,270 and resistance at $1,285.
The weekly chart remains bullish but with the stochastic oversold and together with the RSI diverging relative to the new highs in the price, I believe the risk reward for being long at current levels is not worth it. Shorter-term and more aggressive traders with tighter stops might find a tradable opportunity targeting $1,325.