Current Trend: Short-term down. Med-term up. Long-term sideways to up.
Strategy: Sell short on a bounce to $1325.
Chart and summary below:
Chart Setup: The gold price has formed a symmetrical triangle (lines 1 and 2). And has broken down below line 1 support and its 50-day moving ave to trigger a short signal. Yesterday however it gave a bullish candle, so it’s likely to bounce a bit before heading lower.
- Its short-term Stochastic is in its oversold zone so it can bounce from current levels.
Strategy Details: Sell it short on a bounce to $1325.
Target: Minimum target to $1285, based on the height of the triangle projected down. Take profits there. Further potential would be to line 4 support at the $1263 level.
- To the upside, there is a solid resistance band at line/s 3 ($1367-$1375). A price close above $1375 will be a very positive sign. But it doesn't look like it will happen just yet (probably later in the year).
Stop-loss: A close above $1341, its 26th Feb high. Once it closes below $1295 bring stop down to a close above $1320. And once it trades below 1290 lower a trailing stop to a breaking of its prior one-day high.
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