A Potential Trade Idea – the Gold


Yesterday, our analysis on gold entitled, Gold Stuck In A Range – When Can We Expect A Breakout? turned out to be incredibly accurate. The precious metal gold placed a high of $1253, while our take profit was at $1252. Alas, we closed our trade taking fewer green pips before the release of U.S economic figures, to avoid uncertain fluctuations.

We have no regrets, because we trade technicals rather than luck.

The stronger U.S dollar caused a drop in gold. Favorable new home sale figures and a strong trendline support in a daily timeframe attracted buyers.  

Gold - Hourly Chart

Gold – Hourly Chart

Technical Outlook

At the moment, gold is trading at $1243 after breaking a strong trendline support level of $1244. The RSI (at 41) and the candles below EMA are signaling a selling bias in the yellow metal. Moreover, it has come out of an ascending triangle pattern.

So can we expect a big drop in Gold? Absolutely!

That is if the market keeps trading on technicals, without being influenced by any fundamental. Hence, the gold has a potential to target $1235 and even $1227, if it holds below $1246.

ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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