Extremely Rare Candlestick Pattern on the Gold Daily Chart
The Three Stars in the South candlestick pattern is a very uncommon bullish reversal pattern. I've only ever seen it complete on the daily timeframe one other time in my career - when Tesla went on its truly parabolic run from 1300 - 3000+. See related idea.
Seriously, that's the last and only time I have seen this on a daily chart without it being a historical reference in a textbook. The pattern is seldom mentioned due to its infrequency (and thus its inapplicability to beginner-level traders), but the market analyst, Thomas Bulkowski, was able to find a few examples and define the pattern concretely. Some of the statistics mentioned in his candlestick encyclopedia:
Three Stars in the South:
a) has an approximate frequency of 4 candles for every 9 million that print
b) results in a strong bullish reversal 100% of the time it forms on a significant timeframe (believe it is daily and higher)
Anyways, just thought I'd mention since I did say Gold could approach a much higher target in the near future.
-ThreePigsInTheSouth
XAUUSD
XAUUSD
GOLD
DXY
SILVER
Seriously, that's the last and only time I have seen this on a daily chart without it being a historical reference in a textbook. The pattern is seldom mentioned due to its infrequency (and thus its inapplicability to beginner-level traders), but the market analyst, Thomas Bulkowski, was able to find a few examples and define the pattern concretely. Some of the statistics mentioned in his candlestick encyclopedia:
Three Stars in the South:
a) has an approximate frequency of 4 candles for every 9 million that print
b) results in a strong bullish reversal 100% of the time it forms on a significant timeframe (believe it is daily and higher)
Anyways, just thought I'd mention since I did say Gold could approach a much higher target in the near future.
-ThreePigsInTheSouth
XAUUSD
XAUUSD
GOLD
DXY
SILVER
Trade active:
Alrighty, bear trap/short squeeze seems to finally be taking effect today. Gold has a tendency to fake the break (as all gold bulls are very aware of), so I do see a slight chance of one last leg down, in similar fashion as the prior two days.
However, I see this as extremely unlikely; silver being up so much is a pretty solid confirmation of legitimate reversal.
Aside from the silver confirm, the technicals underpinning the equity indices (the dow and Russ particularly) are pretty damn bearish, which is why Im finding it odd how few shorties there are, at least publically on this site. Yes, the Nasdaq had a nice day yesterday, but any weakness in tech (perhaps due to impending higher inflation, insane overvaluations, etc.) and all stocks will surely rip down for at least a few days.
For the cherry on top, we have quad witching today, which sets the stage for extreme volatility - and more importantly - expected extreme volatility. For there to be a paradigm shift, the market needs to have reason to be fearful of change. Witching provides an excellent backdrop for a metal/stock leadership change in asset classes.
So, buy gold, sell stocks, short tech into next week is my strategy and it will prove to be a multi-bagger if correct across the board.
Good luck, today will be challenging.
However, I see this as extremely unlikely; silver being up so much is a pretty solid confirmation of legitimate reversal.
Aside from the silver confirm, the technicals underpinning the equity indices (the dow and Russ particularly) are pretty damn bearish, which is why Im finding it odd how few shorties there are, at least publically on this site. Yes, the Nasdaq had a nice day yesterday, but any weakness in tech (perhaps due to impending higher inflation, insane overvaluations, etc.) and all stocks will surely rip down for at least a few days.
For the cherry on top, we have quad witching today, which sets the stage for extreme volatility - and more importantly - expected extreme volatility. For there to be a paradigm shift, the market needs to have reason to be fearful of change. Witching provides an excellent backdrop for a metal/stock leadership change in asset classes.
So, buy gold, sell stocks, short tech into next week is my strategy and it will prove to be a multi-bagger if correct across the board.
Good luck, today will be challenging.
Trade active:
Once BTC starts its last freefall, should see gold reverse. If BTC and stocks fall tomorrow, gold may fake the selloff and then start its big move up.
Would expect gold to begin its rally within the next week if it is to happen at all.
Would expect gold to begin its rally within the next week if it is to happen at all.
