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Gold breakdown sees bounce back to $1178
The breakout below $1178 last week provided a bearish indicator, representing the first close out of this range for over a month. Typically, a breakout of this kind would be better served by waiting for a pullback to then enter the trade at the breakout point, and this is what has come to fruition today.
The recent bounce higher has brought the price back to $1178, and thus I am bearish as long as the gold price is below $1182. This gives me a small amount of room to maneuver yet also a very good risk to reward ratio.
We have seen the descending trendline broken recently, yet with the stochastic around overbought, I expect to see this level respected. Downside support would likely first come in around $1169 followed by $1162.