Golden rain: how low can we go? What with 2,5 long trend?
Updated
After big FOMC and ECB announcements global finance situation is more clear. Doubts and fears in global economy are addressed and big institutions stated what they see and how will try to act. One of the longest up trends on global markets might be still continued even if at a slower pace, many worrying circumstances are recognized, things are being planned so maybe overall future is more clear now - less doubts so maybe Gold found it as a more safe place and capital is retracing back to other more risky spheres. Also please notice how last trigger of massive down trend on gold started exactly on a day when Trump was elected, we might see same situation due to resolved (for now) risks around North Korea and potential military conflicts in region with China involved. Trade wars are far less worrying part of current history.
2,5 year long bull run with one big 'reset' on the way triggered by big global event - controversial presidential election result in USA. On this period we had higher bottom which triggered another bull run ended by ascending triangle (on two levels) which probably ended with last big events. Global risks are cleared, variables are reduced - markets react in cooling way as seen on gold. I personally thought that we will brake out up over 1310 and 1360 with road opened to new all time highs. In result with things more sorted Gold market is cooling down. How far will it retrace?
I tried to find analogy between last two big runs with still including current up trend but maybe again switched to slower pace - global risks were explained and addressed, not solved yet so reall issues will come back. Until then we could experience way bigger moves down than we expected on price movements from last 1,5 year (since 2017).
All hopes for a big spike up are switched to finding new low and maybe saving our 2,5 year long up trend - that is why closest supports is at first on 1241 USD but we should expect forming another fresh start in this bigger trend so it probably will be ignited at a slower pace so lower than extension of last bottoms would suggest. That is why we cold look for them at 1215 and 1177. Breaking below would open huge way to bottoms not seen since years like 1125-1130 and in my opinion at this point we would not stop there. All options will be opened, first stop could be around real mining costs of Gold but as we can experience from that big and long bear runs - this should lead us for a long time a bit under just to squeeze market extremely.
These last scenarios are extreme and far less probable than setting new low between 1177-1241 (Fibonacci retracement levels) and starting new - third - wave of trend which we see in last 2.5 years. RSI below 30 points suggests it based on last experience when it occurred. Personally I gave up my long positions in favor of short and now this is my official position on this market. With still up trend in longterm I'll watch carefully supports listed above. Fall already is very rapid, can last long, based on last RSI behavior it should be in sub 30 levels for around month.
Please tell me what are your thoughts and perspective, would be happy for likes to reach wider group opened for a discussion. I'll update this chart with bigger perspective, local events and future decisive moments.
2,5 year long bull run with one big 'reset' on the way triggered by big global event - controversial presidential election result in USA. On this period we had higher bottom which triggered another bull run ended by ascending triangle (on two levels) which probably ended with last big events. Global risks are cleared, variables are reduced - markets react in cooling way as seen on gold. I personally thought that we will brake out up over 1310 and 1360 with road opened to new all time highs. In result with things more sorted Gold market is cooling down. How far will it retrace?
I tried to find analogy between last two big runs with still including current up trend but maybe again switched to slower pace - global risks were explained and addressed, not solved yet so reall issues will come back. Until then we could experience way bigger moves down than we expected on price movements from last 1,5 year (since 2017).
All hopes for a big spike up are switched to finding new low and maybe saving our 2,5 year long up trend - that is why closest supports is at first on 1241 USD but we should expect forming another fresh start in this bigger trend so it probably will be ignited at a slower pace so lower than extension of last bottoms would suggest. That is why we cold look for them at 1215 and 1177. Breaking below would open huge way to bottoms not seen since years like 1125-1130 and in my opinion at this point we would not stop there. All options will be opened, first stop could be around real mining costs of Gold but as we can experience from that big and long bear runs - this should lead us for a long time a bit under just to squeeze market extremely.
These last scenarios are extreme and far less probable than setting new low between 1177-1241 (Fibonacci retracement levels) and starting new - third - wave of trend which we see in last 2.5 years. RSI below 30 points suggests it based on last experience when it occurred. Personally I gave up my long positions in favor of short and now this is my official position on this market. With still up trend in longterm I'll watch carefully supports listed above. Fall already is very rapid, can last long, based on last RSI behavior it should be in sub 30 levels for around month.
Please tell me what are your thoughts and perspective, would be happy for likes to reach wider group opened for a discussion. I'll update this chart with bigger perspective, local events and future decisive moments.
Note
Wider perspective Note
Local situation - false brake out from triangle, brake out from ascending triangle with flat top, heading to trend line formed on start and last formed bottom in 2,5 year long trend.Note
This looks quite bad.Trade active
Shorts still active, engagement increased by two 'trading units' - more shorts at 1269 and 1269,75.Trade active
1270 resistance worked perfectly, take small profit in the middle of current channel at 1255. Little bounce back right now to 1260. Gold is falling as planned. Trade active
Approaching most important support - line of 2,5 year long trend and 0.5 Fibonacci retracement of last 1,5 year long uptrend. Took some profit at 1255 and 1252 but I see that for that clear trends it would be better to stay with just trailing stop - set at 10 USD for now.
Will see what will happen at 1241, if we will blast through it then I'll increase my short position.
Trade active
1/4 of the position reduced at 1241 and another 1/4 of shorts reduced when we pulled back 10 USD so at 1248. Have to admit that now I'm clueless - will we go straight up so support worked or is this just a correction.Trade active
What if this is it? Maybe 1241 support (based on biggest dip and start of this whole 2,5 year long trend) was final and we are still going up.This rally down was great deal although now I'm waiting on hourly chart for any brake out - I'll increase my shorts back to previous state or will filp it all to long.
Trade active
Switched to LONG but now with only one 'trade unit'. All profit from short cashed. We'll see, still I'm aware of these lower supports and chance that gold will move to uptrend at a slower pace like it did 1,5 year ago.Trade active
Critical moment. Will we stay above region of 1241 in daily closing prices? Another false signal possible but this time it looks like that will happen in closing prices, not intraday. Still falling dawn is more likely although I still have some hopes for that this support will last. For now: I closed longs at 5, 10 and 15 USD trailing stop in up trend. Now I'm without position. Waiting for any solid move above or under 1241.
Note
It's gonna be hard to recover from this, today is the day which will be very important - if we will close below 1241 in daily closing prices then we are falling down way more (most probable). Currently without position, waiting for stronger move down or closing above.Trade active
Yeap, situation looks clear finally - we are going waaay down: Note
Approaching another important support, whole thing works perfectly, moves this scale tend to be very long so we could just pass that support although it's quite strong one. Please notice how long last time was fall - look at market zones at https://RSI.https://www.tradingview.com/x/PcCmv7Pd/Trade active
3/4 of my short positions were reduced at 1215-2116,5. Now waiting to take it back higher or if we will close above 1215 in daily closing prices - then we'll have to think about longs but very carefully for now.Trade active
Free falling, trend is still strong and we should get to 1177. If reversal would happen around 1185-1177 then it would be the same situation like last time so we would be still in a long term up trend but now at slower pace ...but I presonally doubt it - we are going way down.Trade active
It was a perfect run, we are approaching point where bigger move of this kind happended and ended 1,5 year ago. Will we bounce from now up?With a great help from US Dollar we managed to execute this wave way down here, will it last way more? In my scenario I planned to take profit around 1177-1180 region or bit above if trailing stop will work. I'll try to now look how this would behave, if we'll pass 1270 then this wave could stop in region of 1120 but I'm still more likely leaning towards current scenario that 2,5 year long trend up will hold up but now we will go up at slower pace. Although even with trade wars gold doesn't seem to be affected by it. I'm far from treating 'crypto' as a new gold but maybe this could be a big beneficiary of possible overall market fall - was a crypto fall a pre stage for that?
Also - massive H&S at EURUSD suggests that USD could continue it's current wave - that's a reason for gold still falling also.
What do you guys think? I hope that you traded last months at gold also that well :)
Note
Blue region in RSI indicates how last wave lasted, will this work in the same manner?Trade active
Well we reached our target but overall situation on markets makes me think that we have still a lot of reasons to fall more. But target and now this formation, maybe we had to take more profits out or even close trade bit earlier.Trade closed: target reached
OK, all profits taken, now based on current events and big move last 1/3 of my position was closed with profit. Earlier at 1177 when target was reached. Although there was a lot of place for other trades, amazing time. Now with small long at gold and EURUSD.
Thank you all and hope that you profited on that rally well :)
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