Important: This site uses New York Close Forex Charts so that each 24-hour session starts and ends at 5 pm EST. These charts are essential for trading price action.
On April 16th I wrote about a significant breakdown for gold.
The market had just cleared key support at 1280, an area that had held the market above it throughout 2019.
However, I also pointed out a confluence of support at 1260 in that same post.
As you may well know, support and resistance are often areas or zones rather than exact prices.
The 1260 region is no different.
Following the break of 1280 support on April 16th, gold retested trend line support that extends from the 2018 low.
The market didn’t quite make it to 1260, but it has tested trend line support nonetheless.
This leaves gold with a critical decision.
If buyers intend to keep this rally intact, they need to secure a daily close back above the 1280 handle.
The “daily close” refers to the New York 5 pm EST close.
Go here to get instant access to the same New York close Forex charts I use.
They’ll also be required to clear the trend line from the year-to-date high near 1290.
On the flip side, if sellers want to continue to push their agenda, they’ll need to break trend line support on a daily closing basis.
While the price structure for gold in 2019 looks relatively bearish, I’m not going to rule out the possibility of a bullish move here.
It’s always a good idea to plan for both outcomes regardless of how convincing a particular outcome may appear.
I also think it makes sense to step aside for now.
Gold needs time to figure itself out. I wouldn’t want to have capital on the line with this much indecision surrounding the next move.
To summarize, a daily close above 1280 would expose the trend line near 1290 while a close below 1260/70 would open the door to 1240 and perhaps 1215.
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