GOLD – only a matter of time before $1300 is tested
Why we like the trade - Gold is consolidating following its break above a multi-month channel line and formed a strong uptrend since the August low. The congestion is now taking shape in a consolidation pennant, most visible on the four-hour and daily time frame. A breakout to the topside and a test of $1300 level will evolve quickly, perhaps even going on to test the $1330 to $1345 area. Keep in mind though that $1300 is strong resistance, given the number of inflection points, so it may struggle to break on its first attempt.
On the downside break of the pennant, a break should extend into the $1268 to $1256 area, which coincides with 78.6% Fibo. of the price extension from its lows in August and horizontal support (highlighted by the green shaded zone). In this scenario, we would be leaning into longs here for a wave 5 into $1320.
Disclaimer.
Trading leveraged products carries a high level of risk and may result in you losing substantially more than your initial investment. Pepperstone Group Limited is licensed and regulated by the Australian Securities and Investments Commission (AFSL 414530). Pepperstone Limited is authorised and regulated by the United Kingdom Financial Conduct Authority (FRN 684312). This information not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
On the downside break of the pennant, a break should extend into the $1268 to $1256 area, which coincides with 78.6% Fibo. of the price extension from its lows in August and horizontal support (highlighted by the green shaded zone). In this scenario, we would be leaning into longs here for a wave 5 into $1320.
Disclaimer.
Trading leveraged products carries a high level of risk and may result in you losing substantially more than your initial investment. Pepperstone Group Limited is licensed and regulated by the Australian Securities and Investments Commission (AFSL 414530). Pepperstone Limited is authorised and regulated by the United Kingdom Financial Conduct Authority (FRN 684312). This information not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
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