Bearish ABCD Pattern in Gold – Get Ready for Swing Trade!
Arslan Butt • 1 min read
So far, the gold is trading exactly in line with our forex trading signal suggested in Knee-Jerk demand for Haven Assets – Gap In Gold. Today, most of the focus is on the "ABCD" the technical analysis pattern. Check it out…
Tensions between North Korea & U.S – A Quick Review
Gold soared right after a sharp call from the United States for the United Nations to institute even tougher sanctions on North Korea due to its additional hydrogen bomb test over the weekend.
In response, U.S. President Donald Trump also threatened to cut off trade with any country doing business with North Korea. This was a direct threat to Japan, China & its allies who are in business with tNorth Korea. Yet, despite all the efforts & sanctions, North Korea isn't stopping its missile tests which are leading towards huge uncertainty.
Technical Outlook of Gold
On the hourly time frame, the gold has formed another ABCD pattern, recently completing the C to D wave at $1338. Now, the same level is working as a solid resistance.
Gold – Bearish ABCD Pattern – Hourly Chart
It's a bearish ABCD pattern, which is likely to make gold bearish below $1338. Overall, the 50 – periods EMA is suggesting investors' bullish bias, but the leading indicators are entering the overbought region. This is another signal that the bulls are getting exhausted and we may see seller's dominating the market soon.
Gold Trade Plan
I'm sticking with these two plans:
Sell – Below $1337 with a stop loss above $1340 to target $1325.
Buy – Above $1324 with a stop below $1320 and a take profit at $1332.
Today, a break above $1338 will lead the metal towards $1345, and there we can try another sell. Good luck!