The following information is a guideline (trading plan) and should not be treated as financial advice. Not advice but banter and active in sharing trade ideas via twitter @sugardaddyFED. You can also follow us via TradingView.com for the latest charts update.
- With the Aussie dollar heading sharply lower, we are not discounting that gold could see follow through selling
- In addition, the US dollar index is anticipated to test higher so no joy for the yellow metal
- A break below 1169 will open the flood gate for 1162 and then 1156 levels
- Downside pressure persist with several target of previous low at 1169 and 1162 levels
- Only a break and close above 1205 will alleviate the selling pressure
- A break and close below 1150 then expect lower prices to advance to 1100 and 1050 levels
- The bearish gartley remains a possibility but will be invalidated on a break below 1150
- Unless drastic happen, there is lack of buyers in gold but a risky long at 1162 with a very tight stop could be in play
- A large sell order at 7 am London time open the flood gate and broke below the megaphone pattern (tested close to 15.50 levels which was highlighted in our article)
- Price continue to trade below the 20 DMA and we cannot rule out a break lower to retest the lower Bollinger band at 15.50
- The daily chart is a hammer candlestick but is this end of the selling?
- Noteworthy, the price broke below the Bollinger band and could well be the start of a reversal (need confirmation)
- RSI remains steady and not at oversold readings yet
- Short term expectation is for further weakness but if sellers fail to push lower then expect a squeeze
The short term bottom at 1057.7 is in danger of being tested and we are showing it here on a lower time frames. A break and close above 1082.8 will get us to enter a long position. Let us take this opportunity to also show how price action may repeat itself here. We drew the circles at the RSI indicator a week before it happen and given that it is playing out like this does not bode well for platinum.
Without a clear signal that the selling has abated and no divergence on the RSI, then sellers will continue to drive this market lower. Sell off continues and there is no respite after worries automobile sales could go south in China. Commodities currencies are free falling and with a stronger dollar on the background, this is a sellers’ market.