Early in the European session, gold is trading around 3,865, below the 21SMA, and within the uptrend channel formed on September 19.

Gold reached a high at about 3,895. From this level, we have seen a series of technical corrections. So, the instrument is likely to continue its decline until reaching the bottom of the uptrend channel around 3,840.

If gold consolidates above 3,870 in the coming hours, we could expect a resumption of the uptrend. Hence, the metal could reach 3,906 around +2/8 Murray.

On the other hand, while the gold price is trading below 3,870, the outlook could be negative, and a technical correction is expected that could push the price to the Murray level of 8/8 at around 3,750 in the short term.

Gold appears overbought on the daily chart, so a pullback to the 3,890 or 3,895 level is likely to be seen as an opportunity to sell.

The Eagle indicator is showing a negative signal on the H4 and H1 charts, so short positions could be an option.