Risk-off Sentiment Seems to Fade – Our Sell Position in Gold!
Arslan Butt • 1 min read
Gold soared 200+ pips on Friday as risk-off sentiment continued to dominate the market. During the late Asian session, we entered a forex trading signal on the sell-side to capture a quick 30/40 pips. Are you wondering what’s risk-off and why we decided to stay bearish? Let me help you…
Fellas, ‘risk-off’ is a market scenario wherein investors feel uncertain about the economic conditions, perhaps owing to geopolitical tensions or impending war. In this particular situation, they start withdrawing their investments from the risky assets like stock markets and invest in safe-haven assets such as gold.
As a result, stock markets slump and Gold begins to rise. The market has already priced in the trade war and bulls seems to be exhausted now. Sooner or later, markets are likely to retrace back. Let’s take a look at the technical outlook.
Technically, Gold has entered an overbought zone which means the bulls may start taking profits. The bearish trendline on the daily chart is providing solid resistance to Gold near $1,349.
Gold – Daily Chart
GOLD – XAU/USD – Trading Idea
Our forex trading signal is to stay bearish below $1,348 with a stop above $1,350 and a take profit near $1,344. We will take another position very soon. So, stay tuned for updates. Good luck!