Sive Morten
Special Consultant to the FPA
- Messages
- 18,648
Greetings everybody,
It is nothing new on gold market by far. And I thought, (if we consider AUD today in FX update), why not to take a look at NZD instead of Gold market? Just to avoid many questions because setup there is very similar to AUD. BTW, it indirectly confirms our suggestion on USD strength and pressure on gold market...
On weekly NZD we have bearish grabber, suggesting drop below the recent lows. But potentially we also consider more extended action in a way of full sized AB-CD right to 0.60 area and 5/8 support. Pay attention that deeper retracement doesn't contradict to idea of monthly bullish reverse H&S setup (and huge bullish engulfing pattern, that you could see on quarterly charts). In fact, action to 0.6 is just a part of the larger bullish picture:
On daily chart market stands in tight consolidation, a kind of flag pattern, after "222" Sell pattern. The major risk here is potential shift of "222" into Butterfly with upside breakout. But, based on price shape, we think that this risk is small. Because downside action has started with bearish reversal month (and week), recent upside action has clear AB-CD shape that makes evident the retracement feature of the pullback. Now, downside action is again accelerating. And this is absolutely not typical in a moment when price has to accelerate, if we suggest bullish continuation action. It is too many contradictions with normal bullish price behavior.
If you decide to try this scenario, on 1H chart you could consider few levels for short position taking. Most probable is 0.6282 - XOP target and butterfly 1.618 extension. Potentially it might be larger AB-CD up to major 5/8 level around 0.63 area, but with less probability. The most simple way is enter with 1/3 trading volume - 1/3right now, 1/3 around 0.6280 and 1/3 around 0.63 if it will be achieved. Otherwise- try to catch the level that you like more, or enter on minor pullback once the downside action start accelerating:
It is nothing new on gold market by far. And I thought, (if we consider AUD today in FX update), why not to take a look at NZD instead of Gold market? Just to avoid many questions because setup there is very similar to AUD. BTW, it indirectly confirms our suggestion on USD strength and pressure on gold market...
On weekly NZD we have bearish grabber, suggesting drop below the recent lows. But potentially we also consider more extended action in a way of full sized AB-CD right to 0.60 area and 5/8 support. Pay attention that deeper retracement doesn't contradict to idea of monthly bullish reverse H&S setup (and huge bullish engulfing pattern, that you could see on quarterly charts). In fact, action to 0.6 is just a part of the larger bullish picture:
On daily chart market stands in tight consolidation, a kind of flag pattern, after "222" Sell pattern. The major risk here is potential shift of "222" into Butterfly with upside breakout. But, based on price shape, we think that this risk is small. Because downside action has started with bearish reversal month (and week), recent upside action has clear AB-CD shape that makes evident the retracement feature of the pullback. Now, downside action is again accelerating. And this is absolutely not typical in a moment when price has to accelerate, if we suggest bullish continuation action. It is too many contradictions with normal bullish price behavior.
If you decide to try this scenario, on 1H chart you could consider few levels for short position taking. Most probable is 0.6282 - XOP target and butterfly 1.618 extension. Potentially it might be larger AB-CD up to major 5/8 level around 0.63 area, but with less probability. The most simple way is enter with 1/3 trading volume - 1/3right now, 1/3 around 0.6280 and 1/3 around 0.63 if it will be achieved. Otherwise- try to catch the level that you like more, or enter on minor pullback once the downside action start accelerating:
