Oct. 2 – Bearish Gold – Reversal or Retracement? - Forex News by FX Leaders

Oct. 2 – Bearish Gold – Reversal or Retracement?

Posted Monday, October 2, 2017 by
Arslan Butt • 1 min read

What’s up traders, we made it through another profitable month. Let's welcome October and get ready to catch some nice profits. The USD is playing defensive after falling to a multi-month low and causing selling pressure on the Gold. Yes, this was anticipated, that's why we entered a sell signal early on Friday.

On the fundamentals side, the current is really significant from the trading point of view as we have Fed Chair Janet Yellen speaking and the ADP Non-Farm Employment Change, ISM Non-Manufacturing PMI and Labor Market figures on the docket.

Technical View of Gold

The technical outlook is quite clear. On the 4-hours chart, gold prices are still consolidating below 50 periods moving averages at $1,300 along with momentum indicators below 50. This signifies a neutral bias of investors.

Gold - 4- Hour Chart - Support AreaGold – 4- Hour Chart – Support Area

Zooming out to the hourly chart, the metal has to complete 23.6% Fibonacci retracement at $1,278, and it may go for $1,280, the 38.6% retracement. Don't know about Fibonacci? No worries, check out FX Leaders Fibonacci trading strategy to avoid the trap in wrong trades.

Gold Trading Plan

The trade plan is simple. I'm gonna take a buy position above $1,275 and another buy above $1,271 with a stop below $1,267 in order to target $1,278 and $1,280. Good luck guys and trade carefully!

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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.
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