In the four hour view, I can see we are currently in a confirmed descending channel, the current rate and bearish pressure is favouring a continuation of the channel for now. I can see the EMA 50 is above the current price indicating we are in a weak market and should be looking for an opportunity to short the market. However the descending channel setup I have drawn out is for a buying opportunity. I would be looking for a clear break of the channel top and a 4H candle closure outside the channel. I would then like to see some indecisive price action which indicates accumulation of orders, etc, before a hook back to the channel top which would give me an opportunity to place a long position on the dxy. I would use a trend based fib extension to see where my 1 and 1.618 level fib lies on the chart and use them as my TP1 and TP2, placing my SL just below a confirmed support level within the channel and I would only take the trade if it fit my risk reward ratio of 1:3.
Clear divergence on the MACD. Price is currently at the exact same level as the previous swing low but look at how the macd is so much less bullish now then it was before. This provides further confluence to my view of the Dxy rising. When the US dollar index rises, gold drops😉 which ties in with the fundamental data which I have. The MACD Divergence is shown marked with purple lines, difference between physical price action on swing lows as well as difference between MACD. This provides confluence for a long position as the divergence means the pricing of the dollar index has been manipulated by the market makers to drop, causing gold to rise. This analysis also provides confluence to my previously posted idea about Gold dropping.
Please don't hesitate to message me if you have any questions/feedback/counter-arguments :)
Clear divergence on the MACD. Price is currently at the exact same level as the previous swing low but look at how the macd is so much less bullish now then it was before. This provides further confluence to my view of the Dxy rising. When the US dollar index rises, gold drops😉 which ties in with the fundamental data which I have. The MACD Divergence is shown marked with purple lines, difference between physical price action on swing lows as well as difference between MACD. This provides confluence for a long position as the divergence means the pricing of the dollar index has been manipulated by the market makers to drop, causing gold to rise. This analysis also provides confluence to my previously posted idea about Gold dropping.
Please don't hesitate to message me if you have any questions/feedback/counter-arguments :)