Gold is trading sideways and has formed a bearish flag pattern. This sideways action following the sharp decline from $1,255 is not an encouraging sign for bulls. As I have been saying for the last few weeks, the longer-term trend remains bearish and despite the bounce from $1,180, we should consider this bounce only as a corrective bounce and that selling pressures should resume soon.
Breaking below the $1,225 low will confirm the end of the sideways corrective move and the start of a new downward move towards $1,190-$1,180. The upward bounce from $1,180 has most probably finished at $1,255 and as I said in previous posts, I prefer to look for sell opportunities as my longer-term target remains at $1,050.
In the 4-hour cahrt, we observe that price is still inside the Ichimoku cloud and this support still holds. Breaking below $1,225 will push Gold price out of the support area and will be a sell signal. Resistance is found at $1,240 and any bounce should find a strong resistance and a lot of sellers at that point.
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