Gold currently has everything speaking for it, the technicals & fundamentals. There is no points trying to short this product currently. In the longer term I do imagine a move is needed to let traders start "doubting" this upward trend, but until that set up presents itself, there is no reason to trade anything but long.
Looking at the daily chart, it contains everything a strong move requires.
1. Its being traded in a steep and tight channel.
2. Recent trading range before this latest breakout was mimimal, leaving traders to buy at the top.
3. Breakouts to new highs (above previous bars close and previous swing highs) leads to more buyers than sellers.
4. There is no room to make money on the short side.
Recent move down is the first "real" attempt to reverse this trade, usually a move like this means a larger trading range can be expected for some time, but until more price action to confirm that view have been presented, there is no reason to doubt this trend.
Short term setup:
I do expect this trade to present itself either Monday or Tuesday this coming week.
Looking at the hourly graph, we have seen the first attempt to continue the trend and a H1 buy setup. We also had a failed breakout to a new high, and a run towards the weak hands stop-losses with the recent swing low.
The bearish momentum in this pullback is strong enough to leave me to believe a H2 buy setup is more likely, we also had a "perfect" hit of the bullish trendline on the daily graph, which usually doesnt work.
There should be eager reversal traders waiting to short below the weak reversal bar presented on the daily graph, also bullish stop-losses which creates plenty of volumes for institutions (smart money) to enter their long trade.
Worth noting, there is no reason to try short this move down towards the H1 stop-losses, this is 100% a long setup and I will patiently await the right time to enter long. In such a strong trend there is decent probability that such a H1 will work, but I place my bets that a H2 buy is worth waiting for, even if it means to miss the trade.
I do believe there is decent chance were entering a period of trading range, so I will look at profiting above the recent high, might be worth keeping abit skin in the game with a trailing stop.
Good luck out there traders!
Looking at the daily chart, it contains everything a strong move requires.
1. Its being traded in a steep and tight channel.
2. Recent trading range before this latest breakout was mimimal, leaving traders to buy at the top.
3. Breakouts to new highs (above previous bars close and previous swing highs) leads to more buyers than sellers.
4. There is no room to make money on the short side.
Recent move down is the first "real" attempt to reverse this trade, usually a move like this means a larger trading range can be expected for some time, but until more price action to confirm that view have been presented, there is no reason to doubt this trend.
Short term setup:
I do expect this trade to present itself either Monday or Tuesday this coming week.
Looking at the hourly graph, we have seen the first attempt to continue the trend and a H1 buy setup. We also had a failed breakout to a new high, and a run towards the weak hands stop-losses with the recent swing low.
The bearish momentum in this pullback is strong enough to leave me to believe a H2 buy setup is more likely, we also had a "perfect" hit of the bullish trendline on the daily graph, which usually doesnt work.
There should be eager reversal traders waiting to short below the weak reversal bar presented on the daily graph, also bullish stop-losses which creates plenty of volumes for institutions (smart money) to enter their long trade.
Worth noting, there is no reason to try short this move down towards the H1 stop-losses, this is 100% a long setup and I will patiently await the right time to enter long. In such a strong trend there is decent probability that such a H1 will work, but I place my bets that a H2 buy is worth waiting for, even if it means to miss the trade.
I do believe there is decent chance were entering a period of trading range, so I will look at profiting above the recent high, might be worth keeping abit skin in the game with a trailing stop.
Good luck out there traders!