GOLD on the daily chart formed a strong bearish engulfing formation yesterday. Layout is definitely bearish. On the chart I marked most of such formations. Of course not 100% of those formations are valid but they are enough strong that we should not ignore the yesterday’s . The chart indicates that the price from the end of last year respects precisely the edges of the growth channel. For this reason, the theoretical range of declines is somewhat limited. The last few highs are created at the local line, so it seems that you can assume that price goes down to the lower edge of the channel or slightly lower to support set by the last two lows. A descent lower than 1260.00 could seriously undermine this year’s growth structure.

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