- Gold has started to pick up a bid again after fading the initial 4Hr resistance line breakout.
- An opportunity of a 1:2.5 risk to reards buy setup has emerged from the recent price action in bullish conditions.
This was a developing story for the day.
Further to the following analysis,
whereby the price has broken a 4HR resistance line, the price of gold has been faded at the session highs.
However, the correction has stalled at a significant Fibonacci level of the strong impulse and has moved back into bullish territory on the shorter-term time frames.
This gives rise to an opportunity to buy into the strength at a discount within the day's range and target a familiar resistance structure in the 1965s.
The following offers a 1: 2.5 risk to reward buy setup opportunity from hourly and 15 min time frame analysis:
As can be seen, the price is testing resistance from which could give rise to a pullback to the new support structure where a buy limit order can be placed.
Targetting 1965 with a top below structure offers a 1:2.5 risk to reward trade setup.
We will be following the price action on a 15-min time frame and monitor for breakeven opportunities if the buy limit is filled.
Update: Buy limit filled
Update: Breakeven achieved
As can be seen, following a spell of being in drawdown, the price, as expected, finally broke to the upside and new structure has been created which should act as a support on retests of the downside prior to achieving the target.
The worst-case scenario is now a breakeven trade as the risk of the positing run free towards a 2.5 R target.
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