Before the weekend I opened a new Long position on Gold because it was already clear that price had a hard time going lower and testing the $1200 mark. Actually I expected and maybe even hoped for another test of the bottom of the triangle.
The fact that this didn’t happen is actually a good thing because it shows us there is some strength in price and bulls are around.
There are a couple of things that made me go long:
- A breach of the 8ema while stochastics is oversold.
Price managed to close above the 8ema on the daily timeframe while being oversold.
- A bounce of the triangle apex middle support
The support from the weekly triangle held firmly and provides protection for our long entry.
- Footprint of the bull
The head and shoulders pattern on the H4 shows us the bulls are here again printing a first higher low.
- An inside candle on the weekly
The weekly inside candle is just a bonus. It may provide us with some extra explosive price movements. This however can be both ways but obviously we expect it to the upside.
So……maybe gold can shine again in the summer period. We do know that September is the best month in the year for gold bulls so it’s important to have a good position ready when September starts. We need to keep an open mind because price can still reverse and test the bottom of the weekly triangle…..only price will tell…..