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Today’s Trading Edge: Gold’s BullishTechnical Setup

Posted by Edward Moya on Nov 8, 2013 9:13:00 AM

WWM GOLD Nov 8 2013

The big move this Non-Farm Payroll (NFP) was the selloff in gold after momentum investors embraced selling the precious metal after the $1,300 level was taken out.  Traders at 8:15 am started to unwind bullish positions and after the NFP release surprised most economists with a better than expected increase of 204,000 jobs last month, gold was sold and the U.S. dollar was bought across the board. 

The four-chart above displays a potential bullish Gartley Pattern at $1,292.  If valid, a bullish rebound may occur and target a move towards a retest of the $1,300 handle.  This technical pattern typically identifies a reversal after the C to D leg is confirmed with either the 61.8% or 78.6 Fibonacci retracement of the X to A move.    

The trade: Buy Gold at current price ($1292 ), with a stop loss at 1288, and a take profit at 1299.  The Risk/Reward Ratio is 1:1.75. 

Edward J. Moya

Technical Strategist

WorldWideMarkets Online Trading

 

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