We Got A Funky Head And Shoulders On Gold. Will It Play Out?
Looking at the 4-Hour view on Gold, we see that we have a potential inverted head and shoulders pattern playing out. However, we have not yet seen a retrace to the neck zone (Labeled on the chart ).
As we are Breakout/Retest traders, we always always always like to see a retrace back to where the initial break out occurred from before we considered entering.
The extreme price of the head is at the 1782.6 support level, and for the past few days, we have been expecting the price to trend slightly higher based on the divergence the histogram of the MACD has been showing. We have seen sellers weakening. We have also been expecting the price to push the 1810 point; old support flipped resistance. We also see a nice trend line moving upwards following price. This suggests bullish movement.
We also notice volume decreasing, suggesting that a strong move could soon be on the cards. So play this carefully. Always wait for a setup to present itself and come to you. Never FOMO into a position.
A retrace to the Neck zone would be where we would enter a long position. If we see no retrace and price heads towards the 1810 level without coming down to retest the trendline and neck zone, then no setup = No entry. A retrace to the neck zone and trendline would provide a safe entry with a RR of 1/4. The target would be the 1810 zone.
As we are Breakout/Retest traders, we always always always like to see a retrace back to where the initial break out occurred from before we considered entering.
The extreme price of the head is at the 1782.6 support level, and for the past few days, we have been expecting the price to trend slightly higher based on the divergence the histogram of the MACD has been showing. We have seen sellers weakening. We have also been expecting the price to push the 1810 point; old support flipped resistance. We also see a nice trend line moving upwards following price. This suggests bullish movement.
We also notice volume decreasing, suggesting that a strong move could soon be on the cards. So play this carefully. Always wait for a setup to present itself and come to you. Never FOMO into a position.
A retrace to the Neck zone would be where we would enter a long position. If we see no retrace and price heads towards the 1810 level without coming down to retest the trendline and neck zone, then no setup = No entry. A retrace to the neck zone and trendline would provide a safe entry with a RR of 1/4. The target would be the 1810 zone.