Gold Returns to the 100 SMA As the Triangle Narrows - Forex News by FX Leaders
Bouncing again off the 100 SMA

Gold Returns to the 100 SMA As the Triangle Narrows

Posted Thursday, January 17, 2019 by
Skerdian Meta • 1 min read

Gold has formed a ritual in the last two weeks, bouncing higher one session, only to turn bearish in the next one. Yesterday we highlighted the range in Gold, which now looks increasingly like a triangle. Gold has been bouncing inside the triangle for many days now without being able to break at either side.

The top of the triangle has been defined by the resistance area around the $1,294-5 level which has been providing solid resistance now, while the bottom of the range has been defined by the 100 SMA. Moving averages are dynamic indicators, unlike support and resistance lines which are static.

So, moving averages actually move, hence the name. And this moving average has moved higher and is still doing so, making the triangle narrower every day. This will surely lead to an explosion in one direction. Although, I hope that it happens to the downside since we are short on Gold with a long term trade/signal.

Right now the price is at the bottom line of the triangle, which is the 100 SMA and that is providing support once again. If this H1 candlestick closes like a doji or a hammer, then that would be a reversing signal and very likely Gold will reverse back up again. But, let’s hope that the break comes today.

 

 

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About the author

Skerdian Meta // Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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