Gold Challenges January’s High
Shain Vernier • 1 min read
The past three sessions have been big ones for April GOLD, with prices rallying above the 1330.0 handle. Today’s action has been defined by limited participation, yet Friday’s strength has lingered. At press time, April gold futures have rallied to an intrasession high of 1330.8 and are up more than $4.50 per ounce.
Safe-havens often see increased demand during holidays and market closures. This is largely a result of institutional traders hedging against unexpected systemic risk. President’s Day 2019 has certainly been a case study in this phenomenon as related to global bullion.
April Gold Futures: Technical Outlook
Since last Thursday’s open, April gold has rallied $20 per ounce. That is a nice move north for anyone long this market and may not be over yet.
Bottom Line: From a technical standpoint, a bullish bias toward gold is warranted. Price has driven well above the 38% Current Wave Retracement (1312.2) and is threatening January’s High (1331.1). In the event this level is taken out, then a rapid test of $1350.0 is likely by Friday’s closing bell.
Until elected, I will have buy orders queued up from just above January’s high at 1331.2 in April gold futures. Using an initial stop loss of 15 ticks, this trade produces a fast 10-12 ticks on a breakout scalp trading plan. Order flow is sure to spike immediately above 1331.1 as a bulk of short positions are stopped out. It is best to use a stop-limit order with a maximum negative offset of 4 ticks to get in on the action.