Wednesday, January 5, 2011
Gold – daily chart
I was scanning through my charts and GOLD chart popped out as very interesting one.
Gold is in massive bull run, as you can see from this daily chart.
Is that going to continue?
There are some warning signs on that chart. First, market developed three push pattern on October 18th, November 9th and December 7th. Also, next swing high didn’t break previous one, so lower high was made.
Currently gold is trading below 10 and 20 exponential moving averages, but it is still above 50. If gold closes below 50 ema, that is currently just below going price, possibility of testing red line will increase.
If you want to be less aggressive, possible short trade would be close below 1361 low from December 16th.
Trend line is currently around 1263 and is resting exactly where previous major high was. So, some 100 points could be made on this short.
Stop loss is obviously close above 1431, which is previous major high.
Trade with trend!