XAU/USD..2h chart pattern..I'm planning a *short trade (SELL)* on the *XNG/USD* (Natural Gas vs. US Dollar) pair, with a resistance level at *3.720* and a selling target at *3.340*.
### *Trade Plan Summary:*
- *Entry Zone:* Near *3.720* (resistance)
- *Sell Target (Take Profit):* *3.340*
- *Potential Drop:* ~10.2% from entry
### *Key Considerations:*
1. *Confirmation Needed:*
- Wait for *price rejection* (e.g., bearish candlestick patterns like pin bars, engulfing) at *3.720* before selling.
- Check if RSI/Stochastic shows *overbought conditions* (>70) for stronger confirmation.
2. *Stop-Loss (Risk Management):*
- Place stop-loss above resistance (e.g., *3.780–3.800*) to limit losses if the breakout reverses.
3. *Market Context:*
- Is Natural Gas in a *downtrend*? (Lower highs/lows strengthen the bearish case.)
- Watch for *USD strength* (since XNG/USD is inversely affected by USD rallies).
- Monitor *inventory data* (EIA reports) or weather forecasts impacting Natural Gas demand.
4. *Profit Target Justification:*
- *3.340* could be a support level (previous low or Fibonacci retracement level).
- Consider *partial profit-taking* at intermediate levels (e.g., 3.500) to secure gains.
### *Alternative Scenario:*
- If *3.720 breaks upwards*, the bearish setup fails—watch for a potential bullish reversal.
