Gold Is Testing the Support at $1,255

Gold bounced off from the resistance at $1,275 after forming several candlesticks on the daily time-frame that were a signal for a move to the downside, namely a hanging man candlestick and several spinning top candlesticks. The precious metal reached a considerable support level at $1,255, which coincides with the (MA)89 indicator on the four-hour time-frame and it has been testing it since Friday. It could either bounce off from that support and rally to test the high at $1,275 – a scenario that is very likely considering the hammer candlestick and the multiple spinning top candlesticks that have formed on the same four-hour time-frame above the support – or it could break out below the (MA)89 indicator and continue falling towards the next possible support level at $1,247, which is the same indicator, but on the daily time-frame.