Bullish channel is depicted by blue lines.
Bearish RSI divergence (red line)
The current price of gold is about $1,823. As long as price is trading within the bullish channel, the short-term outlook is bullish. Price continues to make higher highs and lows while staying within the lower boundary of the channel. The current level of support by the lower limit of the channel is $1,798. For as long as this condition persists, bulls will maintain their trend leadership position. Although price is almost at new highs, the RSI is almost set to signal a bearish divergence. The likelihood of a reversal will increase considerably if the RSI generates a new negative divergence signal. The $1,835–$1,845 range acts as both support and resistance on the way up. The year has begun off as optimistically as it concluded. Yet, we are treading carefully as the RSI is flashing bearish divergence signals.
