Gold price continues to make higher highs. The trend remains bullish but we have several bearish divergence signals. Gold is likely to make a pullback towards $1,200 before the up trend resumes towards $1,400. I do not expect gold to make any major breakout now.

Red lines - bullish short-term channel

Gold is trading above both the tenkan- and kijun-sen indicators. The trend is bullish. However, the RSI (5) produces some bearish divergence signals. I believe bulls should be extremely cautious as a break below $1,263 will open the way for a bigger correction towards $1,243 at least.

Despite having broken above the sideways consolidation, gold lacks the upside momentum which is not as strong as it should be. This means that the best bulls can hope for is a slow grind higher towards $1,280-90 maximum before the downturn. I feel pretty confident that this is not the time when gold will make any major breakout. I expect gold price to get rejected at the 78.6% Fibonacci retracement.