Gold Violates $1,222 – Quick Update on our Trading Signal - Forex News by FX Leaders

Gold Violates $1,222 – Quick Update on our Trading Signal

Posted Thursday, July 19, 2018 by
Arslan Butt • 1 min read

What’s up, fellas.

Gold is trading exactly in line with our forecast Gold Intraday Outlook: Stronger dollar drags gold to one year. It is progressively heading towards our long-term target level of $1,212. Here’s a new trading signal for today…

1) Fed Chair Powells – Hawkish Remarks

One of the major reasons behind a massive sell-off in gold is the hawkish remarks from the Fed Chair Powell. As we know, there’s a negative correlation between the dollar and gold. The dollar rose after upbeat comments on the U.S. economy by the Federal Reserve’s Chairman reinforced expectations by investors of the currency’s long-term strength.

2) Descending Triangle Pattern – Breakout

The second important reason behind a strong sell-off is the violation of sell descending triangle pattern. The market is still trading as per our plan. As you can see on the two-hour chart, gold has come out of the descending triangle pattern and is likely to continue its selling trend until the next support level of $1,221 (already violated this morning) and $1,212. The leading indicators, RSI and Stochastics, are massively oversold yet investors can stay fundamentally bearish until $1,212.

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Gold - 2 Hour Chart

Gold – XAU/USD – Trading Plan

Fellas, we shared a trading signal to stay bearish below $1,222 with a stop above $1,226 and take profit at $1,218. We can also extend take profit to $1,214. Good luck!

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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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