FX.co ★ Trading idea for gold

Contrary to what was expected, gold closed with an absorption last Friday (see screenshot below), which suggests that investors should close their short positions at the stops of buyers, more specifically at 1850. Do this in the lower time frames, and then take profit after the breakdown of 1850.

This is the best strategy because as seen in the chart, gold has a three-wave pattern (ABC), where wave A represents the selling pressure on Friday.

So, investors should sell gold to set off a pullback from 1875 towards the 61.8% Fibonacci retracement level. Place stop loss at 1890, and then take profit on the breakdown of 1850. This idea is under the framework of Price Action and Stop Hunting.

Good luck!