Oversold Gold - Investors Ready To Catch Retracement - Forex News by Strategia Forex

Oversold Gold – Investors Ready To Catch Retracement

Posted Tuesday, July 4, 2017 by
Arslan Butt • 1 min read

Yesterday, the gold fell drastically, dropping more than 200 points. The fall was due to the stronger US dollar. Most of the pressure was caused by a sharp uptick in US bond returns after the release of positive manufacturing activity figures. This activity signals robust economic growth in the United States.

As we mentioned in our weekly forex signal report, the buck was supposed to trade with a bullish sentiment. This is to be expected as investors are likely to price in the optimistic expectations of the US NFP and Unemployment rates before their release on Friday.

 

Forex Trading Signal – Idea

Today we have two options for trading the gold:

– Buy above $1220 with the take profit of $1227 and stop loss below $1217.

– Sell below $1229 with a take profit of $1221 and stop loss above $1232.

Gold - 4 Hours Chart - Retracement In PlayGold 4-Hour Chart – Retracement In Play

 

Key Technical Points

On the 4-hour chart, both of our leading indicators, the RSI and Stochastic, have entered the oversold region. This means that the gold could bounce back to complete the 23.6% Fibonacci at $1227 and 38.2% Fibonacci at $1232.

However, the moving averages are signaling a selling trend in gold. To be safe, let's wait for the market to complete the retracement before entering a sell position in gold.

 
Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies

About the author

Arslan Butt // Index & Commodity Analyst
Arslan Butt is our Lead Commodities and Indices Analyst. Arslan is a professional market analyst and day trader. He holds an MBA in Behavioral Finance and is working towards his Ph.D. Before joining FX Leaders Arslan served as a senior analyst in a major brokerage firm. Arslan is also an experienced instructor and public speaker.
Related Articles
Bullard is the most dovish member of the FED. But he mentioned rate hikes today, instead of further cuts.
29 mins ago
Comments

Leave a Reply

avatar
  Subscribe  
Notify of