Sive Morten
Special Consultant to the FPA
- Messages
- 18,771
Gold Daily Update, Fri 19, April 2013
Good morning,
market still holds with gradual upward retracement and now has reached 3/8 resistance at daily time frame. Overall action looks as bearish flag here. Slightly higher we see 50% resistance and daily overbought, that could be useful today:
Recall that yesterday we've discussed two potential patterns here - Butterfly and AB-CD. As market has moved above the high of butterfly swing and erased it, the only pattern that we have is AB=CD and it has hit it's target by now. Interestingly that AB=CD target coincides with daily 3/8 resistance and gives as so called Agreement and a kind of "222" Sell pattern. As CD leg is slower than AB, market could show bounce down from this area.
On hourly chart we also see that this is the upper border of the channel (flag) and if market will turn down, then the minimum target will be the lower boarder of the flag.
And here is the place where daily overbought and Fib resistance step in. Now we stand at the point that gives us optimal short entry point from risk point of view. Our stop should be above daily overbought and may be 50% resistance as well, because market will not pass through overbought just occasionally - only if short position will be a mistake and market will continue move up. And now market stands as close to this level as it could. Also it stands at Agreement.
The on problem still with this position - is that we have no patterns currently as we did with B&B "Sell" couple days ago.
Thus, if you want to rely on definite patterns - better to stay flat and search possibilities for trading somewhere else, while if you still want to try to enter short - this is not bad point to try and it has a technical foundation.
Good morning,
market still holds with gradual upward retracement and now has reached 3/8 resistance at daily time frame. Overall action looks as bearish flag here. Slightly higher we see 50% resistance and daily overbought, that could be useful today:
Recall that yesterday we've discussed two potential patterns here - Butterfly and AB-CD. As market has moved above the high of butterfly swing and erased it, the only pattern that we have is AB=CD and it has hit it's target by now. Interestingly that AB=CD target coincides with daily 3/8 resistance and gives as so called Agreement and a kind of "222" Sell pattern. As CD leg is slower than AB, market could show bounce down from this area.
On hourly chart we also see that this is the upper border of the channel (flag) and if market will turn down, then the minimum target will be the lower boarder of the flag.
And here is the place where daily overbought and Fib resistance step in. Now we stand at the point that gives us optimal short entry point from risk point of view. Our stop should be above daily overbought and may be 50% resistance as well, because market will not pass through overbought just occasionally - only if short position will be a mistake and market will continue move up. And now market stands as close to this level as it could. Also it stands at Agreement.
The on problem still with this position - is that we have no patterns currently as we did with B&B "Sell" couple days ago.
Thus, if you want to rely on definite patterns - better to stay flat and search possibilities for trading somewhere else, while if you still want to try to enter short - this is not bad point to try and it has a technical foundation.
