Gold bulls have lost their momentum and the price is threatening the psychological level of $1,300. The bulls must defend this level, otherwise, it is highly that the bears will drive the price all the way to $1,270 mark. The weakness in the gold price is mainly due to the strength in the dollar index- it has regained its strength after being beaten down brutely. Fundamentally speaking, there is no clear evidence why the gold price should be moving lower, the possible explanation behind the current move is that investors are looking at the handsome gains in the equity markets (YTD) and they are more interested in getting their money involved in those asset classes rather than parking it in the safe haven.
Speaking from a technical perspective, the price retraced from its minor resistance level (shown by dotted red line) and the failure of the price breaking above this level made traders take the profit off the table. The gold price is trading below the 50-day moving average shown in green colour on a 4-hour time frame (an intra-day time frame) and this confirms weakness. The hope is that the price will not break the 100-day moving average shown in pink, however, if the bulls fail to defend this, the next support zone is at 1275 followed by major support which is at $1,233.
The RSI indicator is showing that the price is oversold and it is highly likely that the bulls may take control of the price. The Balance of Power indicator needs to move above zero- only that will confirm that the bears are no longer in control of the price.