Good Morning Gold Lovers
Gold long term target 1145 has been hit on Wednesday after the dollar weaker then expected economic data of ISM manufacturing and ADP.Technically 1145-47 was the longer term resistance of descending channel that was forming since 2015 and this level is also the resistance of Ascending channel forming since couple of weeks.Today we will discuss the trade opportunity through different time frame analysis and invalidation points.I am also adding weekly chart today to see the big picture
Weekly Chart Pattern
Gold is in a down trend since years.And from last january 2015 we can see descending channel forming in weekly chart.The resistance of channel is at 1145-49. I believe if gold remain in the channel and follow the lower high and lower low pattern then the next channel support is 1030.If Price break the resistance of 1145-49 and close above the resistance in weekly chart.Then this resistance will become support and the next target of gold will be minimum 1185-91 area and 1233 for longer term extensions.So if you are looking for long term trade in gold.Then the key to get successful trade is a patience.Stay neutral in market un till you get the confirm break or confirm reversal.
Daily Chart Pattern
Gold price is at resistance level in a daily chart and yesterday closing was exact at resistance.We will look for confirm break to follow breakout in daily chart or confirm reversal to follow the trend.I draw a resistance lines in the chart below.Please have a look and wait for the confirmation.
4 Hour Chart Pattern
4 Hour time frame will give us more clear picture or earliest signal.I am expecting a little bit more upward movement in 4 hour chart, There is still no reversal candle or confirmation.If price break the resistance we will look for buy and if we get the reversal signal we will jump for the down rally.
Trade Recommendation :
We will remain neutral for major trades.
I am recommending a sell limit with tight stop loss and take profit.
Sell Limit : 1143-45
Stoploss : 1150
Take Profit : 1133 ( Close half position and move stoploss at entry point)
Take profit 2 : 1125 ( Close Full Position )
I will update the post once we get a clear break or reversal.
Donk risk more then 2% of your total account capital in single trade.Always trade with proper money management plan.
Feel free to comment below if you have any concern regarding chart and analysis.your feedback is always welcome
Wish you Good Luck , Be Patience and Happy Trading
Mati Ur Rehman
Gold Analyst @ Forex.Today