Commodity
by Seth Parker on September 28, 2018

Gold Analysis – Breakout to the downside!

Time to deal with GOLD! Previously we wrote about this precious metal on the 11th of September and we were in the sideways trend waiting for a breakout. The reason why we are going to write about the XAU today, is that we finally got this breakout! This is what we wrote back then:

“Breakout of the neckline will be a legitimate signal to go short and abandon the bullish dream. On the other hand, breakout of the 23,6% Fibo, will be a positive sign and will set us a target on the next Fibo level – 38,2%. „

gold chart

Traders chose to go down. The price broke the lower line of the triangle or if you will – the neckline of the head and shoulders formation. After the bounce from the 23,6% Fibo, that is a sell signal. Currently we are on the lowest levels since the middle of August. We can see that the bearish momentum is quite high and the breakout looks legitimate. Sell signal will be cancelled when the price will come back above the red line but that is less probable at the moment.

By Seth Parker

Seth is a professional trader with over 10 years of experience. He specializes in the technical analysis. His main focus is on the pure Price Action. In his trading, Seth used the trends, supports and resistances and technical formations. Always, the most important thing in his strategy is the money management. Seth reached a proficiency in trading and for the past three years is doing that for a living enjoying the sun and lovely beaches of the Spanish coast.

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