Gold in a Double Top Setup with a Target of 1720
Trend Analysis
The main view of this trade idea is on the 15-Min Chart. The precious metal Gold is currently exhibiting a double top pattern setup, with the resistance area around the 1795 price level. The metal is currently testing 1780 support. If support holds, it may be temporary and the metal will find resistance around the downward trend line highlighted in red. If support breaks, it is expected that the trend reversal will continue, taking Gold towards 1720. Failure of this pattern would be observed if the precious metal breaks above 1800.
Technical Indicators
Currently Gold is trading below its short (25-MA), medium (75-MA) and long (200-MA) fractal moving averages. The key identifier in the change in trend is the break below the 200-MA. The RSI is also trading below 50 as the metal tests support. The longer timeframed KST is also in a negative zone, which is bearish for Gold.
Recommendation
The recommendation will be to go short at market. Stop loss will be set around the 1800 price level and a target of 1720. This produces a risk-reward ratio of 3.69.
Disclaimer
The views expressed are mine and do not represent the views of my employers and business partners. Persons acting on these recommendations are doing so at their own risk. These recommendations are not a solicitation to buy or to sell but are for purely discussion purposes. At the time publishing, I have a position in Gold.
The main view of this trade idea is on the 15-Min Chart. The precious metal Gold is currently exhibiting a double top pattern setup, with the resistance area around the 1795 price level. The metal is currently testing 1780 support. If support holds, it may be temporary and the metal will find resistance around the downward trend line highlighted in red. If support breaks, it is expected that the trend reversal will continue, taking Gold towards 1720. Failure of this pattern would be observed if the precious metal breaks above 1800.
Technical Indicators
Currently Gold is trading below its short (25-MA), medium (75-MA) and long (200-MA) fractal moving averages. The key identifier in the change in trend is the break below the 200-MA. The RSI is also trading below 50 as the metal tests support. The longer timeframed KST is also in a negative zone, which is bearish for Gold.
Recommendation
The recommendation will be to go short at market. Stop loss will be set around the 1800 price level and a target of 1720. This produces a risk-reward ratio of 3.69.
Disclaimer
The views expressed are mine and do not represent the views of my employers and business partners. Persons acting on these recommendations are doing so at their own risk. These recommendations are not a solicitation to buy or to sell but are for purely discussion purposes. At the time publishing, I have a position in Gold.
Trade closed: stop reached
