Gold, in its 2-hour chart, shows the exhaustion signals of the upward sequence developed by the yellow metal in five waves.
The ascending move belongs to a wave ((c)) of Minute degree labeled in black, and its internal subdivision in five waves looks complete after the price topped at $1,6783.6 per ounce on Monday 06th.
Watching inside of the fifth wave of Minuette degree identified in blue, we observe the five-wave subdivision and the ascending channel in where the price soared above the upper-line. This thrust leads us to foresee the exhaustion of the upward sequence and the potential declines for the following trading sessions.
A bearish position will activate if the price closes below the $1,647.7 per ounce. Our conservative bearish target locates at the end of wave iv of Subminuette degree labeled in green at $1,599.70 per ounce. The invalidation level of our bearish scenario is located at $1,675.7.
Trading Plan Summary
- Entry Level: $1,647.7
- Protective Stop: $1,675.7
- Profit Target: $1,599.7
- Risk/Reward Ratio: 1.71
- Position Size: 0.01 lot per $1,000 in account.