- Analyzing Gold’s technicals for potential profitable long entries on shorter time frames.
- Identifying a 3-month consolidation pattern, suggesting an imminent breakout opportunity in the Gold market.
- Patience will be rewarded as there is still time for bulls to take positions.
In this week’s Gold technicals, we will focus on shorter time frames for possible long entries that could yield excellent short-term profits. In our previous analysis, we were waiting for Gold to retrace to the support level of $1924.4. Price is currently there, and now is the time to look for opportunities. If you want to see a full breakdown of the GC technicals, go here.
It is clear to see the possible trade opportunities available to Bulls on the GC chart if we zoom out. In the chart below, there is a consolidation phase that has become indicated by the purple triangle. If we take a moment to ignore the candles and just look at the price fluctuations, this simply tells us that Gold has been sitting within the $100 range for 3 months. This is acting like a spring; when a break out occurs, it could lead to a fast-moving market. Now would be the time to look for buys if the trader is bullish because price is at the bottom of the range.
4 Hourly Chart
The 4 hourly chart shows no signs of bullish divergence yet so there is still time to wait before initiating a long. Stops can be placed below $1,900 but traders should be careful of a potential ‘fake-out’ as a capitulation candle is very possible at this point.
Even though Gold has been selling off for the past few weeks, there are long opportunities that have greater risk-reward ratios and expectancy. Bulls will want the price to remain above $1,900, however, because if that level breaks, it would be breaking support, and price is likely to continue falling. There is no need to rush this trade because there is still time to wait for a potential bullish divergence to occur on the 4-hourly chart or possibly a consolidation phase.