In this idea I will prepare you for the new week. There are a few important things you need to pay attention to before trading gold. I will share which things you should add to your chart. This time I decided to give you a summarized point of view, that will allow you to understand everything easily without spending too much time reading. Let me know if you appreciate this!
Without further ado, the $1740 level has been incredibly important recently. It has acted as resistance many times before, showing that people believe this is an important level.
For my initial trade set-up this week I suggest to leave the trade before this area, as we cannot be sure what will happen once we approach this $1740 area.
Another important thing is the high amount of noise in the world. There is a lot of stuff going on in Minneapolis causing anxiety in the U.S. Also with Corona breaking out in new countries and creating serious issues in Brazil, India, and the middle east we see an increased uncertainty.
All of this uncertainty means two things. First of all, it is difficult to predict price movements that are further out. I decided to switch to shorter timeframe ideas, such as the one here on the 1h.
The second thing is that in times of uncertainty people often take their money out of the stock market and put it in gold instead. That's why overall I have a bullish view on gold right now.
The price is at a bit of an odd level at the moment, it is not a good moment to either buy or sell. That's why I suggest this trade set-up where we let the price fall a bit before we enter a long. This will increase our risk reward ratio.
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- Trading Guru
-------------------------------------------------------------- Disclaimer! This post does not provide financial advice. It is for educational purposes only!
Comment
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The previous analysis was a good success overall, as the price did go up like we hoped. However, the price didn't retrace enough to hit our buy zone so no trade was made for this previous idea.
I just published another new idea where I am looking at a two way scenario depending on the direction gold is going to take:
i like your trade idea and i agree with your Analysis 100%. I am following this trade.
Trading-Guru
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@NMKTrader, Don't like this one too much! It is not going well. I think the idea got invalidated, so I will do a more thorough analysis today and publish a better new idea
lordaeoka
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I do like your explanation on the topic
Trading-Guru
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@lordaeoka, I think you say it very kindly, because if you look at the results they were actually quite off. The price immediately shot up instead of retracing a bit first how I charted it. But I really appreciate you said something nice at least about the explanation ;)
so what shud be approach now..if it comes lower at 1725 shud it still be bought .
and what if it doesnt fall to 1725 n breaks 1742..what trade we opt for
Trading-Guru
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@cardano9, As you can see the price is struggling near the resistance zone right now:
if it breaks through I think we can keep our bullish bias. But if it bounces, I will wait for the retracement and enter the long position still.