The new year pushed gold up finally breaking the long consolidating descending channel which was evident for long.
And since then, Gold never looked down and kept the climb up extremely powerful.
After a fortnight, we have finally observed a little breather on the instrument.
Looking at the price action on it, we could see that gold almost double topped with the recent hourly candles breaking but not closing about the prior high. And in addition, it has also formed a triangle at the top of the move. While classically, a consolidation inside a triangle results in a break towards the upside, here, the triangle has appeared after a consolidation and a double top which does not give a direction of the breakout.
Hence, to get the direction of the breakout, we look for price action inside the triangle. From what is observed, the bull candles have covered the same number of pips in half the time the bearish candles have taken to cover indicating a strong bullish sentiment. Also to add to this is long wicks on the downside of the candles evidencing the previous conclusion.
The best way to take this would be a buy on the bounce from the lower trendline of the triangle so the stops move up with the trendline to breakeven as the price climbs or an entry on the breakout-retest with targets being the next resistance level at 1319 giving a 22 dollars run with stops just below the lower trendline right below the breakout.
And since then, Gold never looked down and kept the climb up extremely powerful.
After a fortnight, we have finally observed a little breather on the instrument.
Looking at the price action on it, we could see that gold almost double topped with the recent hourly candles breaking but not closing about the prior high. And in addition, it has also formed a triangle at the top of the move. While classically, a consolidation inside a triangle results in a break towards the upside, here, the triangle has appeared after a consolidation and a double top which does not give a direction of the breakout.
Hence, to get the direction of the breakout, we look for price action inside the triangle. From what is observed, the bull candles have covered the same number of pips in half the time the bearish candles have taken to cover indicating a strong bullish sentiment. Also to add to this is long wicks on the downside of the candles evidencing the previous conclusion.
The best way to take this would be a buy on the bounce from the lower trendline of the triangle so the stops move up with the trendline to breakeven as the price climbs or an entry on the breakout-retest with targets being the next resistance level at 1319 giving a 22 dollars run with stops just below the lower trendline right below the breakout.
