Gold prices turned lower after a positive start, driven by a small uptick in the dollar after it had made a weaker start to the new week. After a very bright last few months, a bit of a pullback and side-ways action is always needed in strong uptrends. Regardless of whether we will see some further short-term weakness following last week’s 3% drop is not going to materially change the long-term outlook, which remains bullish. With core PCE data coming up later in the week, I wouldn’t be surprised if gold were to remain in consolidation mode for much of this week. Gold closed lower last week, although managed to bounce off its lows on Friday and enjoyed mild gains on Monday. The metal’s losses earlier in the previous week were triggered by profit-taking after it briefly poked its head above April’s all-time high but couldn’t hold on. Investors were happy to take profit after what has been a stellar last few months. Investors will be looking forward to key inflation data from both the US and Eurozone this week. The data could shed light on the timing of the first rate cut by the ECB and Fed, both of which have been pushed back again on the back of a much stronger-than-expected Eurozone wage growth and a solid US business activity report, which also showed a sharp rise on in services inflation. On Friday, though, the University of Michigan’s revised inflation expectations survey showed a drop in 1-year inflation to 3.3% from 3.5% reported initially. This helped to weigh on the dollar index and provided buck-denominated metals some support.  Core PCE is this week’s key data releaseAs mentioned, the Fed’s favourite inflation measure will come out on Friday, putting all the major FX pairs and gold into focus. The core PCE figures will be published a week before the May jobs report comes. Until then, the dollar, and by extension, gold, may remain in a holding pattern. Stagflation concerns are rising in the US, with price pressures remaining higher and incoming data mostly surprising negatively of late, which does not bode well for the economy. The PCE data could impact the timing of the first rate cut, currently expected well after the summer. Gold weekly chart hints at possible reversal……Although similar reversal-looking price action in the past have turned out to be bear traps on the gold chart.Last week saw gold print a bearish engulfing candle on its weekly chart, after an attempt to break above April high of $2431 failed to hold. The metal made a fresh all-time at $2450 before closing the week down more than 3%, albeit at short-term support around $2330. The key question now is whether we will get to see some downside follow-through this time. A clean break below $2330 support could trigger some stops and lead to a potentially sizeable drop. What’s more, the relative strength index (RSI) is in a state of negative divergence, pointing to waning momentum. However, we have seen lots of bearish-looking price action in the past few months which have all proven to be bear traps and this one could prove to be yet another such scenario. For example, look at the previous bearish engulfing that was formed back in December, when the metal also made a failed breakout to a new all-time high (circled on the weekly chart). Following the formation of that candle, gold only saw modest weakness follow-up selling, before the dip was bought at just below $2,000, eventually leading to that big rally we have seen in the last few months.  Gold trade ideasThe loss of bullish momentum is also evident on the daily time frame, with the metal breaking a short-term bullish trend line and moving below the 21-day exponential moving average. It has also broken below support around $2375, a level which may now turn into resistance upon re-test. However, gold is yet to make a distinct lower low. The most recent low comes in around $2,277. If this level is breached, then we will have had our first reversal confirmation. Until and unless that happens, take last week’s bearish price action with a pinch of salt. Indeed, if gold were to rise back above the broken $2375 level, then this could trigger a sharp short-squeeze rally to a new all-time. All told, last week’s bearish price action is not a game-changer for gold, although it does warrant some caution. It pays to be alert for signs of bear traps, which could lead to decent long trade setups, in what still is a healthy bullish trend. More By This Author:Nasdaq Powered To New Highs By Nvidia EUR/USD Likely Heading Higher Amid Recent US Data Weakness EUR/USD could be heading to 1.10