FX:XAUUSD   Gold / U.S. Dollar
6136 62 101
First of all : good cop bad cop story worked very well in my last not banned post (https://www.tradingview.com/chart/XAUUSD/nSzQNIkz-GOLD-FISCHERMAN-S-TRICK-THE-GOOD-THE-BAD-AND-THE-CHART/) At Jackson Hole Yellen and Fischer exactly knew that the NFP data will be weak. They just played their roles. Good cop Yellen : “In light of the continued solid performance of the labor market and our outlook for economic activity and inflation , I believe the case for an increase in the federal-funds rate has strengthened in recent months,”
Fed Vice Chairman Stanley Fischer (bad cop) was more explicit, saying Yellen’s comments were consistent with possibly two rate increases this year—including a move as early as next month. Yellen and Fischer both stressed that any policy decision will be dependent on economic data.
They both know there will be NO 2 rate hikes this year. Maximum one. And maybe not even one...
In 2014 summer the dollar started to rally as the FED announced the next rate hike period. The dollar was rallying in 2014 but no rate hike happened. In 2015 the rally continued and peaked in March. At that time we were hearing 2 rate hikes in 2015. We got one in December (LOL) and the whole market stayed bullish . Everybody was talking about DXY             120$.... At the beginning of 2016 we heard about 4 rate hikes in this year. It's September and we haven't had even one. As I'm typing this the dollar index             ( DXY             ) is still at 96$...
Guys sooner or later this bubble will burst and I think it will happen next week when Fischer or another bad cop will announce or hint the miss of the rate hike in September.

Technicals:
Yesterday we broke above yesterday's high and printed a swing low. I was watching closely the market before the data and I saw the clear manipulation after the news. When the news came out there was a horrible contract dump in the first minute which was bought at 1306$ almost immediately. I don't know this contract dumper bought back at the bottom or he was a bit late in the dumping - hoping that the data is bad - and all his sell was bought by another big players. In this last case the late dumber R.I.P. It was an expensive game with a big loss.

So we are on Day2 today in a new daily cycle.
1 (red curve) Even if this daily cycle is a left translated we will rally minimum 5-7 days : whole next week but we are not going to break to new highs.(above 1375$) After that we will roll over into the ICL. 1306-7 will trigger the panic selling.
2 (green curve) If the dollar collapses in the meanwhile - as I think it will next week - gold             not only tag the upper trendline but will break above it making a higher high in this 3rd daily cycle. It would be right translated.
3. (purple curve) If the dollar collapse will be really tough we can break to 1450-1500$ In this case we might have a short 4th left translated daily cycle .

The intermediate decline should tag the 200 SMA at the bottom and might marginally break below it.

Indicators
RSI and SlowStoch is as oversold as it was at the ICL. It suggest a strong rally (version 2 or 3)
And don't forget this DCL has a bear trap. Sooner or later these trapped bears have to stop out (most probably on Tuesday when US markets opening again)

No question this is long now. The real question is how long it will rally...
As we are on day 2 only it's still not too late to enter on Tuesday.
Comment: Big contract dump on NFP.
snapshot
Comment: Bear trap is activated.
snapshot
Comment: 10 $ of a short squeeze.
Poor bears have a bad day today. They not only have realized the bear trap but also feel the pressure of the collapsing dollar.
We are only on day 3 and almost at the triangle's upper trendline.
I say that only scenario 2 and 3 are on the table: We are going to break to new highs.
snapshot
Comment: A possible entry could be at the 10 EMA at 1334-35$ if we have a pullback.
I'm not sure we are going to get it though.
Just an idea for those who would like to enter/add.
I will be adding there if we have a pullback.
snapshot
Comment: BOOM.
Comment: We are tagging the triangle trendline.
Unbelievable.
snapshot
Comment: I think we lost all the bears in the last minutes.
Comment: I'M taking some profit here at the trendline (33%)
Comment: we will have some kind of pullback. And we shouldn't forget about Draghi on Thursday.
Comment: US dollar index is also getting close to the trendline. If you close some profit on your gold position 25-30-35% you can still look in the mirror tomorrow.
Comment: Here is our pullback.
If we are lucky it could come down to the 50 EMA on the hourly.
snapshot
What time Draghi is going to speak?
Reply
14:30 CET which is 8:30 EST ...
Reply
Bought some NUGT.
Reply
'i think we lost all the bears'. i like your comments , post more please, cheers on the trade!
+1 Reply
Trendhopper Calamity
I will buy the gold if or when DXY hits 95.28...completion of bullish butterfly

snapshot
Reply
Hey Arpi, great to have you back ! Regarding the chart, this massive drop to the lows of 200 SMA (1250ish) is the ICL ? This is because we made a new DCL left translated and Cycle wise we need to make a new low again around October-November ? I´m asking because then its just too difficult to place long term positions in this market. Thanks
Reply
THe touch of the 200 SMA is the ICL yes.
But I think this daily cycle will not be left translated. It's too powerful. We will make a higher high. And there will be one more daily cycle.
Scenario 3 most probably. (purple)
Reply
RogerS PRO chartwatchers
What is your best tactic Arpi, take some profits at the top (50-75%) and hedge all the long positions from 1310-1320 to the ICL just in case in not than deep and we don't cross 1300 or take most of the profits at the top 90% and reload at the ICL hoping the decline is quite powerful ? I know its a very personal approach but always helps to vision some other trader tactics.
Reply
If we top I will get out of gold. I will try to short at the ICL. I'M not hedging. The hedge position is confuses me , when you see a big gain on the hedge position you want to take profit and close the position. With hedge positions I always missed the top and the bottom : big green numbers makes you blind.
But holding a core position is always a good idea in bull markets. So you will always be in a long position in the bull market. Never miss a penny.
Reply
rudykorinek chartwatchers
Arpi do you think there will be still this small pull-back? What can Draghi do to make this weaker?
Reply
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