Best Price Action Pattern For GOLD Trend Following Trading
This bullish pattern is very powerful .
Being spotted on a daily/4h/1h, any time frame, it will help you to accurately predict a strong bullish movement on Gold .
In this article, I will teach you to identify a buying volumes accumulation on Gold chart and as a bonus, I will show you how I predicted a recent bullish rally with this price action pattern.
The initial point of this pattern will be a completion point of a strong bullish impulse.
At some moment, the price finds a strong horizontal resistance, stops growing and retraces.
The second point of the pattern will be a completion of a retracement.
It should strictly be a higher low - it should be higher than the low of an initial bullish impulse.
After a retracement, the price should return to a horizontal resistance and set an equal high , that will be the third point of the pattern.
Then, the price should retrace AT LEAST one more time from a horizontal resistance and set a new higher low.
After that, the price should set one more equal high.
3 equal highs and 2 higher lows will compose a bullish accumulation pattern.
Please, note, that the price may easily set more equal highs and more consequent new higher lows and keep the pattern valid.
Above is the example of a bullish accumulation pattern on Gold on an hourly time frame. The price set 3 equal highs and 3 consequent higher lows.
This pattern will signify the weakness of sellers and the accumulation of buying volumes.
The point is that each consequent bearish price movement from a resistance is weaker than a previous one. It means that fewer sellers are selling from the resistance and more buyers start buying, not letting sellers go lower.
In our example, we can clearly see the consequent weakening, bearish price movements.
This pattern indicates a highly probable breakout attempt of the resistance. A candle close above that provides a strong bullish signal.
The broken resistance will turn into support and will provide a safe point to buy the market from.
In our example, the market broke the underlined horizontal resistance and closed above that. It indicates the completion of a bullish accumulation and a highly probable bullish trend continuation.
You can see that Gold retested a broken structure and then a strong bullish wave initiated.
In a strong bullish market that we currently contemplation on Gold, this bullish pattern will provide a lot of profitable trading opportunities.
No matter whether you are scalping, day trading or swing trading Gold, this bullish accumulation pattern will help you to predict long-term, mid-term and short-term bullish movements.
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