Gold - Looking for a potential ending diagonal pattern
|Gold, in its 2-hour chart, shows the advance developed in the latest trading sessions as a third extended wave.
The upward movement drove the golden metal to advance until level $1,640 per ounce. Considering the bullish momentum that carries the price action, we expect fresh highs for the coming sessions that could correspond to an ending diagonal formation.
At the same time, the RSI oscillator shows that the bullish bias remains intact, and the last high at $1,643.35 corresponds to the end of the third wave of Sumbinuette degree identified in green.
The current upward sequence could advance until the zone of $1,660.41 from where we expect a bearish reaction, which could drive Gold to make a new descending sequence.
The downward sequence will activate if Gold shows a reversal move at $1,660.41. This movement could drag the yellow metal to $1,596.37 per ounce. If the price action increases its bearish momentum, Gold could drop till $1,558.15, and even until $1,512.40 per ounce.
The level that invalidates our bearish scenario locates at $1,701.71 per ounce.
Trading Plan Summary
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Entry Level: $1,660.41.
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Protective Stop: $1,701.71.
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1st Profit Target: $1,596.37.
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2nd Profit Target: $1,558.15.
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3rd Profit Target: $1,512.40.
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