Big moves lately with Gold, which gives great opportunity to profits, if you are a trader that takes both bull and bear positions. Large daily uptrend was broken last week, without a retrace or retest to the bottom of that channel. After analysis, it seems that a new wider uptrend channel is in play, as Gold halted for the last 2 hours on Friday at around the $1292 area. With bulls exhausted and the presence of uncertainty, it does not surprise me that a rally did not happen at this level....... yet.
Gold has also formed a smaller downtrend channel, from the initial drop at the $1345 area. It is important to note that Gold halted at the intersection of both the bottom trendlines of those channels. It is a very important area for bulls come market open, as if it breaks down further, that uptrend channel will be invalid, give room for bears to take it down more.
Overall I am neutral at the moment, but possible trades I will take this week.
Scalping:
For the next couple weeks, I am looking to see if the Wedge created by both channel is respected, giving the opportunity for scalping.
Long:
I will initially take a long position (short-term for scalp) at the opening bell, and put a tight Stop Loss as Green-to-Red is quite possible here. If it respects the wedge and breaks up above the resistance, I will position my stop loss at that level and let it ride out.
Short:
Easier position in my opinion. If it breaks below the uptrend and downtrend channels, we could see a few more red days.
For newer traders, it maybe a good option to sit out a bit and allow Gold to breath a bit. But if you do, be smart, apply proper risk management, and GL to all.
Gold has also formed a smaller downtrend channel, from the initial drop at the $1345 area. It is important to note that Gold halted at the intersection of both the bottom trendlines of those channels. It is a very important area for bulls come market open, as if it breaks down further, that uptrend channel will be invalid, give room for bears to take it down more.
Overall I am neutral at the moment, but possible trades I will take this week.
Scalping:
For the next couple weeks, I am looking to see if the Wedge created by both channel is respected, giving the opportunity for scalping.
Long:
I will initially take a long position (short-term for scalp) at the opening bell, and put a tight Stop Loss as Green-to-Red is quite possible here. If it respects the wedge and breaks up above the resistance, I will position my stop loss at that level and let it ride out.
Short:
Easier position in my opinion. If it breaks below the uptrend and downtrend channels, we could see a few more red days.
For newer traders, it maybe a good option to sit out a bit and allow Gold to breath a bit. But if you do, be smart, apply proper risk management, and GL to all.