Weekend Update: Gold Breakout

Gold made a breakout from a significant multipoint triangle consolidation pattern, see right hand chart below.   The main focus for me going into next week is on long trade setups in GC in the smaller degree timeframe as long as we are above the breakout area.  The pressure next week should be on the bears.

What is important to mention is that I do not have any plan to put on an intermediate term trade until the major upper trendline of the dominant “descending triangle” pattern has been taken out with authority. I have no issues paying up in order to increase my probabilities for longer term success.

In the near term, the current high volume node (purple line) of the daily chart is at 1,663 and that is about where major trendline resistance should come into play. Initial support in my opinion should be at the apex of the smaller triangle, around 1,580.

Next week’s COT report will be important as the cutoff was prior to the breakout. This week’s legacy report showed the commercial traders covering 18,696 short contracts and going long 3,878 contracts.

 

Consulting? ScottPluschau@gmail.com

 

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