Gold Short - Fake Break Effect
After the release of U.S. CPI last night, the gold price eventually shot up and break above the top of a range at first.
Very soon, we see the price pulled back sharply as the dollar climbed again.
This is an obvious trap to lure buyers who go for the break-out.
So what's next? Will the buyers just leave because the price came back into the range?
What's gonna happen for the buyers to be forced out of the market?
Simple! The price needs to go lower, low enough for some buyers to give up, low enough to trigger stop losses, and low enough to burst some balloons.
It is unlikely that the price can still go back to the top of the symmetrical triangle as that will give chance for buyers who are trapped at the top to escape.
Once the dollar breaks new low, it would enter the demand zone very soon and that's when we can look for long again (refer to link below).
Very soon, we see the price pulled back sharply as the dollar climbed again.
This is an obvious trap to lure buyers who go for the break-out.
So what's next? Will the buyers just leave because the price came back into the range?
What's gonna happen for the buyers to be forced out of the market?
Simple! The price needs to go lower, low enough for some buyers to give up, low enough to trigger stop losses, and low enough to burst some balloons.
It is unlikely that the price can still go back to the top of the symmetrical triangle as that will give chance for buyers who are trapped at the top to escape.
Once the dollar breaks new low, it would enter the demand zone very soon and that's when we can look for long again (refer to link below).
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