We can now see that gold is forming a potential made up of lower lows and lower highs signalling a potential downside.
Technical factors to consider:
- Lower highs and lower lows
- decreasing in strength
Fundamental factors to consider:
- Positive trade talks between the US and China
- Lowest unemployment rate in 50 years within the US
- Recession fears have the potential to impact this setup negatively as gold/precious metals becomes a "safe haven" for investors
Target for this setup is to catch the next wave down. If the channel is followed this should be just above the 38.20% of around $1450. Stop loss can be placed just above the previous high on the 24th of September which was around $1537, or depending on your risk appetite.
Entry @ ~$1507.50
TP @ ~$1450
SL @ ~$1538
Took partials and moved SL to entry.
Depending on risk appetite, the original SL can stay in place without moving it to entry as I had done in my previous update. This will allow the trade to mature and be more flexible within this setup through intraday price action and news events. I personally have decided to move my SL back to the original $1538 as this setup is valid until price breaks that level.
Patience, is key.