Gold continued to move lower towards $1,260 yesterday after breaking below the support of $1,270-75. The trend is bearish as we have a medium-term reversal signal from last week implying that more downside should be expected. However, I prefer to stay in cash and not short the precious metal.
With a triple bearish divergence in the weekly stochastic, I remain neutral in Gold as I expect the price to continue the pullback towards at least the weekly tenkan-sen (red line indicator) at $1,255. However, depending on the UK referendum, we could even see a push lower towards $1.180-60. My longer-term view remains bullish targeting above $1,400-$1,500.