M pattern on gold chart?
The M pattern is a bearish reversal pattern, suggesting that the price of gold may be poised to decrease. It is called the M pattern because, when plotted on a price chart, it resembles the letter "M." Here's a description of how the M pattern typically forms:
Initial Uptrend: The M pattern usually begins with a strong uptrend in the price of gold. During this phase, gold prices are rising steadily.
First Peak (High Point): After the initial uptrend, there is a peak where the price reaches a relatively high point. This peak is the first peak of the M pattern.
First Decline: Following the first peak, the price starts to decline. This decline is often seen as a correction in the ongoing uptrend.
Temporary Uptrend (Middle Point): After the first decline, there may be a temporary uptrend or a small rally in gold prices. This rally is the middle point of the M pattern and is typically lower than the first peak.
Second Peak (Lower High): Following the temporary uptrend, gold prices again rise but fail to reach the level of the first peak. This forms the second peak of the M pattern, and it is typically lower than the first peak.
Second Decline: After the formation of the second peak, the price of gold starts to decline once more. This decline confirms the bearish nature of the pattern.
Initial Uptrend: The M pattern usually begins with a strong uptrend in the price of gold. During this phase, gold prices are rising steadily.
First Peak (High Point): After the initial uptrend, there is a peak where the price reaches a relatively high point. This peak is the first peak of the M pattern.
First Decline: Following the first peak, the price starts to decline. This decline is often seen as a correction in the ongoing uptrend.
Temporary Uptrend (Middle Point): After the first decline, there may be a temporary uptrend or a small rally in gold prices. This rally is the middle point of the M pattern and is typically lower than the first peak.
Second Peak (Lower High): Following the temporary uptrend, gold prices again rise but fail to reach the level of the first peak. This forms the second peak of the M pattern, and it is typically lower than the first peak.
Second Decline: After the formation of the second peak, the price of gold starts to decline once more. This decline confirms the bearish nature of the pattern.
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