Choppy Session for Gold - Is it a good time to short?

For two days now, the Gold has been stuck near the multi-months high after the dollar slipped against a basket of currencies. The bullion market was only slightly active due to the US bank holiday, but investors are back today. We have closed a trading signal on DAX, pocketing nice profits as a result. Here are further details on our trade on gold...

GOLD / XAUUSD - Technical View
The technical side of Gold hasn't changed much. A couple of days ago, Gold broke out of the ascending triangle pattern at $1,326, leading the metal to a multi-month high of $1,344. With this movement, the precious metal entered the overbought zone.

Gold - 240 - Min Chart
Gold has now formed a candlesticks pattern called "hanging man", followed by the strong bullish candles, signifying a potential bearish reversal. The lagging indicator, 50- periods EMA supports the bearish bias, as well.

From the 4- hour chart below, we can see that the 50- EMA, used to forecast the future behavior of prices in the time series analysis, is currently holding at $1,322, which is also where Gold prices should be. That being said, divergence between lagging indicators and CMP doesn't come as a surprise to us. Today, we should be aiming for $1,335 and $1,331.

Gold // XAUUSD - Trading Plan
The idea is to stay bearish below $1,340, with a stop above $1,344, and take profit at $1,335, and $1,331. Good luck.