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Today’s Trading Edge: Gold tries to end 7-week losing streak in thin trading

Posted by WorldWideMarkets . on Dec 27, 2016 9:51:17 PM

WWM GOLD DEC 27 2016.jpg

Gold prices continued to show signs of stabilizing following the holiday weekend as prices made higher lows on the weekly chart.  The longest losing streak in over a decade appears poised for a possible bounce as price continues to respect the $1,120 low. 

Price action on the gold daily chart shows that in early December, both a bullish ABCD and Gartley pattern were tentatively invalidated after price broke down below the $1,140 level.  If the bullish rebound continues, initial resistance may come from the $1,180 level.  Major resistance may come from the psychological $1,200.  If the bearish move returns, key support will come from the December 15th low of $1,124.  A weekly close below that level could open the door to to make a run towards the 2015 low of $1,045. 

The trade: Buy Gold at $1,135 with a stop loss at $1,125 and a take profit at $1,165. The Risk/Reward Ratio is 1:3

Topics: gold, $GLD

 

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