Hello traders, I'm back,
Gold appears to have formed a head and shoulders pattern on the 1 hour timeframe as displayed on the chart. I believe at some point tomorrow that the $1952 major trend line will be tested, this trend line also coincides with the 61.8 fibonacci retracement of the bullish gold outbreak since the Russian invsaion of Ukraine. Now the question is where to short in order to achieve the highest risk to reward. I have noted a bearish order block that I believe will be retested at the $2010 area. So I would set sell limits to around the $2008 / $2009 level and watch how price reacts if it reaches this level.
Fundamental bearish factors:
Zelensky considering a 'neutral' Ukraine in order to prevent more loss of life, neutral being agreeing to not join NATO.
Supply chain shortages are easing as oil CEO's don't increase output because they are aware this oil bubble will be very short-lived and is already close to popping
COVID gone for good so less risk of future inflation
Note: CPI data tomorrow so expect increased volatility and larger than normal wicks on the smaller timeframe. We will get a good idea of the markets direction for the rest of the month based on how today ends.
Gold appears to have formed a head and shoulders pattern on the 1 hour timeframe as displayed on the chart. I believe at some point tomorrow that the $1952 major trend line will be tested, this trend line also coincides with the 61.8 fibonacci retracement of the bullish gold outbreak since the Russian invsaion of Ukraine. Now the question is where to short in order to achieve the highest risk to reward. I have noted a bearish order block that I believe will be retested at the $2010 area. So I would set sell limits to around the $2008 / $2009 level and watch how price reacts if it reaches this level.
Fundamental bearish factors:
Zelensky considering a 'neutral' Ukraine in order to prevent more loss of life, neutral being agreeing to not join NATO.
Supply chain shortages are easing as oil CEO's don't increase output because they are aware this oil bubble will be very short-lived and is already close to popping
COVID gone for good so less risk of future inflation
Note: CPI data tomorrow so expect increased volatility and larger than normal wicks on the smaller timeframe. We will get a good idea of the markets direction for the rest of the month based on how today ends.