Gold: Bearish Divergence Analysis 1D (Apr. 26)

X FORCE GLOBAL ANALYSIS:


Gold has shown weak bullish momentum for the past few days, after a huge rally from $1,450 levels. In this analysis, we focus on the bearish probabilities for Gold.

Analysis

- Around March 24, we saw a bearish divergence form on the daily chart
- Prices created higher highs, while the Relative Strength Index (RSI) created lower highs
- Eventually, this textbook bearish divergence played out, leading to a 14% drop in Gold prices
- Today, we have spotted something very similar: prices forming higher highs, and the RSI forming lower highs
- We can also see the diminishing bullish histograms on the Moving Average Convergence Divergence (MACD), as well as a potential death cross.

What We Believe

We believe that Gold has topped out locally, and is looking to enter a corrective phase, based on technical indicators and the bearish divergence.

Trade Safe.