Daily Bearish Flag Pattern Completion
Following its largest one-week fall since July 2022 (down 3.0%), follow-through selling failed to surface last week for spot gold, spending the week ranging between $1,890 and $1,852 at the prior week’s session low. Overall, technical studies still suggest bears have the upper hand in the weeks ahead.
Having noted the Relative Strength Index (RSI) rejected the lower side of overbought conditions (70.00) and is nearing the 50.00 centreline, the capacity for further weakness is seen until support at $1,807 enters the fight on the weekly chart. Buyers making a stand at current prices, nonetheless, could turn things in the direction of the prior week’s peak at $1,959.
Substantiating the possibility of additional underperformance is not only the RSI dropping through the 50.00 centreline, but also the bearish flag pattern (sometimes referred to as half-mast patterns) on the daily chart between $1,881 and $1,862. Thursday completed the pattern through a one-sided breakout lower, yet hit a brick wall by way of the 50-day simple moving average at $1,855. Overcoming this dynamic support this week reveals support at $1,828, with subsequent downside exposing the flag pattern’s profit objective at $1,768 and a neighbouring 200-day simple moving average at $1,776.
While the trend is still technically higher on the daily chart, the picture out of the RSI on weekly and daily charts as well as current price movement, shows buyers are lacking steam. Price crossing under the 50-day simple moving average this week would help corroborate the downside bias and, as noted above, expose daily support from $1,828. The test for this market, therefore, remains at the daily support from $1,828.
Short-term price action on the H1 timeframe eventually respected the Quasimodo support-turned resistance at $1,879 and scrambled for Quasimodo resistance-turned support at $1,857, which, as you can see, held firm into the close. Below here, Quasimodo support warrants attention at $1,827, a level lining up with a 1.272% Fibonacci projection (alternate AB=CD pattern) at $1,824 and, of course, the daily support level mentioned above at $1,828.
Direction:
It is all about the H1 Quasimodo resistance-turned support at $1,857 and 50-day simple moving average on the daily timeframe this week. Clearance of the H1 level and the daily chart’s 50-day simple moving average throws light on a bearish scenario towards daily support at $1,828. Respecting the noted support levels, on the other hand, questions the daily chart’s bearish flag pattern and shifts attention back to at least the H1 timeframe’s Quasimodo support-turned resistance at $1,879.
Having noted the Relative Strength Index (RSI) rejected the lower side of overbought conditions (70.00) and is nearing the 50.00 centreline, the capacity for further weakness is seen until support at $1,807 enters the fight on the weekly chart. Buyers making a stand at current prices, nonetheless, could turn things in the direction of the prior week’s peak at $1,959.
Substantiating the possibility of additional underperformance is not only the RSI dropping through the 50.00 centreline, but also the bearish flag pattern (sometimes referred to as half-mast patterns) on the daily chart between $1,881 and $1,862. Thursday completed the pattern through a one-sided breakout lower, yet hit a brick wall by way of the 50-day simple moving average at $1,855. Overcoming this dynamic support this week reveals support at $1,828, with subsequent downside exposing the flag pattern’s profit objective at $1,768 and a neighbouring 200-day simple moving average at $1,776.
While the trend is still technically higher on the daily chart, the picture out of the RSI on weekly and daily charts as well as current price movement, shows buyers are lacking steam. Price crossing under the 50-day simple moving average this week would help corroborate the downside bias and, as noted above, expose daily support from $1,828. The test for this market, therefore, remains at the daily support from $1,828.
Short-term price action on the H1 timeframe eventually respected the Quasimodo support-turned resistance at $1,879 and scrambled for Quasimodo resistance-turned support at $1,857, which, as you can see, held firm into the close. Below here, Quasimodo support warrants attention at $1,827, a level lining up with a 1.272% Fibonacci projection (alternate AB=CD pattern) at $1,824 and, of course, the daily support level mentioned above at $1,828.
Direction:
It is all about the H1 Quasimodo resistance-turned support at $1,857 and 50-day simple moving average on the daily timeframe this week. Clearance of the H1 level and the daily chart’s 50-day simple moving average throws light on a bearish scenario towards daily support at $1,828. Respecting the noted support levels, on the other hand, questions the daily chart’s bearish flag pattern and shifts attention back to at least the H1 timeframe’s Quasimodo support-turned resistance at $1,879.
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