Gold (XAU/USD) Analysis: Bearish Flag Formation After Breakout
This is a 1-hour chart of CFDs on Gold (XAU/USD)
1. Consolidation Zone (Highlighted in Yellow)
The price was consolidating in a range before breaking out upwards.
This period represents market indecision before a breakout.
2. Breakout & Bearish Flag Formation
The price broke out of the consolidation zone and moved higher.
A bearish flag pattern (drawn in blue) is forming, which is a continuation pattern that often leads to a downside move.
The flag consists of an upward-sloping channel, indicating a temporary retracement before a potential drop.
3. Potential Price Movement
If the bearish flag confirms with a breakdown, the price may fall back into the consolidation range or lower.
The expected target is typically the length of the previous downward move (flagpole) projected downward from the breakout point.
Conclusion:
If the price breaks below the flag, it signals a bearish continuation.
If it invalidates the pattern and moves above the flag, the bullish momentum could continue.
Traders should watch for a breakdown confirmation before
1. Consolidation Zone (Highlighted in Yellow)
The price was consolidating in a range before breaking out upwards.
This period represents market indecision before a breakout.
2. Breakout & Bearish Flag Formation
The price broke out of the consolidation zone and moved higher.
A bearish flag pattern (drawn in blue) is forming, which is a continuation pattern that often leads to a downside move.
The flag consists of an upward-sloping channel, indicating a temporary retracement before a potential drop.
3. Potential Price Movement
If the bearish flag confirms with a breakdown, the price may fall back into the consolidation range or lower.
The expected target is typically the length of the previous downward move (flagpole) projected downward from the breakout point.
Conclusion:
If the price breaks below the flag, it signals a bearish continuation.
If it invalidates the pattern and moves above the flag, the bullish momentum could continue.
Traders should watch for a breakdown confirmation before
Trade closed: stop reached
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.