Gold Price Action Analysis – 16th May 2018
GOLD has been Bearish for 3 days consecutively. Today’s first two H4 candles came out as Bullish corrective candles. The current H4 candle seems to be a Bearish candle. If it really ends up being an Engulfing Bearish Candle, then an H1 breakout at yesterday’s lower low would be the signal to go short on Gold today. Let us have a look at the H4 Gold chart.
The level of 1294.70 has been the level of Resistance here. If it is held by the current H4 candle and the current H4 candle engulfs the last H4 candle, then we would have to wait for an H1 breakout at the level of 1288.30 to take the short entry. Let us have a look at the summary of the trade…
- Sell Stop Order: 1288.30
- Stop Loss: 1294.70
- Take Profit: 1278.50
- Validity: 72 hours
- Whenever possible, move the stop loss to the entry price and whenever you want, you can take profit anytime as long as you feel comfortable
The USD has a high impact news event today at GMT15.30. However, I do not think Gold traders have to worry about it that much. It is not a super high impact news event. Moreover, Gold is not only related to the USD. Yes, the USD does have a huge impact on Gold. Thus, we have to consider some news events that are related to the USD such as NFP, FOMC- Interest rate decision. Other usual high impact news events on the USD such as Crude oil inventories, Retail sales m/m, Core retail sales m/m are not to be given that much of emphasis if we are to trade on GOLD (XAUUSD).
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