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
WorldWideMarkets Online Trading