GOLD (GC1 Futures) - Pullback before further move down
Updated
On the weekly timeframe, GOLD (based on the futures chart) has formed a head and shoulders pattern. Taking the Fib points from the most recent weekly high to the most recent weekly low gives us a very clear shorting location.
Keep in mind, the daily POC - standing for point of control - is bang on the 0.382 point of this recent move, however, keep in mind that there is potential for a wick to the 0.5 area as well.
Fundamentally, countries - outside the US - seem as if they are going to be entering recessions in the coming months. Add in the uncertainty around China, there is some leeway for a short term reversal for gold.
Some ideas I have : Go long now, either directly OR via buying call options. After this, look for an initial short entry at the 0.382 area, however, opt for buying put options at this zone. The target for this move is the yellow box designated on the chart.
Remember, buying a call OR put option subjects you to paying the premium, however, there is NO RISK if the position goes against you. This is NOT the case however if you SELL either a call or a put option.
Please remember, this is not financial advice. This is purely my opinion and my opinion only.
Keep in mind, the daily POC - standing for point of control - is bang on the 0.382 point of this recent move, however, keep in mind that there is potential for a wick to the 0.5 area as well.
Fundamentally, countries - outside the US - seem as if they are going to be entering recessions in the coming months. Add in the uncertainty around China, there is some leeway for a short term reversal for gold.
Some ideas I have : Go long now, either directly OR via buying call options. After this, look for an initial short entry at the 0.382 area, however, opt for buying put options at this zone. The target for this move is the yellow box designated on the chart.
Remember, buying a call OR put option subjects you to paying the premium, however, there is NO RISK if the position goes against you. This is NOT the case however if you SELL either a call or a put option.
Please remember, this is not financial advice. This is purely my opinion and my opinion only.
Note
Please note my comment below:There could be a small dip to the red box before retesting the pattern.
Note
As of now, the weekly chart is now testing its POC. Again, there are two possibility here:1) The POC is broken and the price moves up to retest the pattern, OR...
2) The price rejects, moves down towards the red box and then bounces from there
Exercise caution, and manage your risk accordingly. This idea is tailored to a mid-term / long-term bias. Utilise call / put options if possible but remember:
"...buying a call OR put option subjects you to paying the premium, however, there is NO RISK if the position goes against you. This is NOT the case however if you SELL either a call or a put option."
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Keep in mind, this is still in play. It seems the price action is gravitating towards the 0.382 from the get go as opposed to falling further to the red zone first. Be vigilant.
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Price has now hit the 0.382 area. Keep an eye out for a strong rejection
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The 0.5 fib of the weekly wave has now been hit, OBSERVE THE PRICE.Trade active
Looking for a daily close now around the 0.5 FIB.Our short entry will then come either tomorrow or September 1st.
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Very nice daily close. Our entry will definitely come in the next day or two.Note
Just a reminder, the midterm downtrend has begun.Begin looking for shorts. If you can, opt for puts.
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