Will Gold Breakout – 3 Things To Watch Today
Arslan Butt • 1 min read
The safe haven asset Gold is stuck in the sideways trading range despite the weaker US dollar. Today, in the absence of economic indicators, the bullion market is exposed to the technical moves. You should see 3 things before trading Gold today…
1) Sentiment Analysis – Trade War Fear Prevails
We all know the ongoing tensions between the USA and China are weighing on the US dollar. China slapped back with a 25% tariff on the US goods. Gold soared to a multi-week high. But now, the risk-off sentiment is priced in and investors might be considering to follow the technicals. Concluding sentiment analysis, the market may take a bearish reversal.
2) XAU/USD – Sideways Range
You can see on the below chart, Gold is trading in a narrow range of $1,343 -$1,337. The breakout of this range will determine the next trend of Gold. But considering the recent candle, we open a buying signal in Gold, which now seems invalid due to the 3rd reason explained below.
Gold – 4 Hour Chart
3) Candlestick Pattern – Twizzers Top
By the time of writing this update, the Gold signal was closed out at our stop loss and the reason is the lack of volatility and the candlestick pattern. Investors are still staying out of the market ahead of the most awaited economic event: NFP. While Gold has formed a Tweezers Top pattern on the 4-hour chart. The pattern signifies a potential reversal. If the candlestick analysis is something new to you, I would recommend reading FX Leaders Candlesticks Strategy for better understanding.
Gold – Trading Idea
The idea is to stay bearish below $1,336 to target $1,332. At the moment, Gold is trading at $1336.50 and I will be looking for an hourly close below $1,336 to enter a Sell. Good luck.