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Gold Takes A Bullish Turn – Bullish Butterfly In Play
The precious metal gold remains under selling pressure after the Fed raised US interest rates last week and said it planned four additional increases by the end of 2019 and another in 2020, amid steady economic growth and a strong job market.
As we know, higher US interest rates tend to boost the dollar and put pressure on gold prices by hiking an opportunity cost of holding non-yielding bullion.
Gold – 4 Hour Chart
Technically speaking, gold has formed a bullish butterfly pattern on the 4- hour chat which has completed the C to D leg at $1,180 before taking a bullish retracement. I would love to go long on gold but the bullish butterfly isn’t complying with the 20 & 50 periods EMA. Both of the moving averages are suggesting selling bias for the precious metal.
The idea is to stay bearish below $1,189 with a stop below $1,192 and take profit at $1,185. Good luck!
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