Hi Traders! Gold forecast follow up and update is here. On April 21st I shared this “Gold Short Term Forecast” in Trading View. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! In this post lets do a recap of this setup and see how it has developed now.
Now lets summarize the idea first:
Gold H4 (4 Hours) Chart Analysis
On the H4 chart the price respected the importantand is currently moving lower, in addition to this we have a divergence and the price has broken below the uptrend line.
Gold H1(1 Hour) Chart Analysis
On the H1 chart the price has broken below the bottom of the range, currently it is moving inside a, we also have a pattern that has formed. I expect continuation in the short term.
Gold H1 (1 Hour) Chart Current Scenario
On the H1 chart based on the above mentioned analysis my view was bearish in the short term and I was expecting possible continuation lower. But the price moved higher and broke above the top of the bearish channel and is currently holding above it, this has invalidated my bearish view on the H1 chart.
Gold H4 (4 Hours) Current Scenario
On the H4 chart my bearish view still remains the same, we have a first leg down and this first leg is created in the form of a bearish trend pattern. Currently it looks like a pullback is happening, until the 61.8% (1714.45) fibonacci retracement level of the bearish trend pattern holds my view remains bearish here. Alternatively if the price moves higher further breaks and holds above the 61.8% (1714.45) fibonacci retracement level in one straight leg then this bearish view will be invalidated.
As traders we always have two choices, first one is to start and try to convince the market with many different variations like add positions or start to increase your lots, average down, etc… Or simply validate or invalidate your view, have alternative read, check again from the root of higher timeframe and make proper decisions according to the current market conditions. Always follow the facts, it doesn’t matter what view you had yesterday, what matters is what happens in the market today because the market is dynamic and it doesn’t necessarily have to agree with the way you see it. As long as the market follows my ideas and validates my setups I can trade and if it doesn’t switch, have a different read and adjust your plan when required.
Note: Right now with the Corona virus impact the real money flow is not there in the market, a lot of investors and traders are out of the market and are waiting for this crisis to come down. Many traders are sitting on the fence making nothing, what you would see on the market in such period in panics, there are a lot of random fast moves with high volatility, very serious moves, big volumes but these moves are not technical but in such cases its very important to wait for your setups, have your analysis. If the setup comes, trade it and value the risk, if you would be right in high volatility period then once it moves, it moves big and fast but if it doesn’t then you know your risk is limited. Don’t trade without planning your risk its a big mistake.
Watch my video on How to trade during Corona virus Crisis here
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To your success,
Certified Financial Technician