Gold has once again come under selling pressure after prices broke below the bullish channel support that had previously supported its short-term rise. This downward breakout signals the beginning of a weakening buyer dominance. The declining direction of the Moving Average, coupled with the ZigZag pattern that is starting to show lower swing points, increasingly emphasizes a market structure change towards a bearish trend. This condition indicates that the short-term momentum no longer supports a rise.
Moreover, the MACD indicator entering the negative zone strengthens the bearish bias by displaying a loss of upward momentum. On the 1-hour time frame, this combination of technical signals places Gold in a position to continue declining. As long as the price remains below the breached support area and fails to return within the bullish channel, selling pressure is likely to remain dominant, opening up further bearish opportunities.
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The head and shoulders formation on the 15-minute time frame provides a strong signal for the potential decline of Gold, with the price poised to test the level of 4,155. This bearish pressure is further reinforced by the downward slope of the Moving Average and the ZigZag pattern already establishing a lower high and lower low structure. The combination of these three signals indicates that selling momentum is still dominant, thus Gold has the potential to continue weakening in the short term as long as the price remains below the neckline of this pattern.
Technical Reference: sell below 4,211
Potential Stop Loss 1: 4,200
Potential Stop Loss 2: 4,211
Potential Take Profit 1: 4,165
Potential Take Profit 2: 4,155
