Gold is in a bearish trend forming lower lows and lower highs and breaking support levels in its structure. With the given structure, we will be looking to take a short position at a retracement towards the 1875 level. The target would be the lower support residing at the level of 1840. 

The bearish pennant pattern has been formed. The breakout sells have been taken out and candles are validating the breakout sells. These breakout sells will continue the bearish trend once the retracement is complete. Along with this, we also see a descending trendline which needs to be tapped at the resistance + retracemenet level. 

The golden retracement area is at the price of 1872, which is slightly below the resistance level. This retracement is the level to be considered as it has a huge pending orders of sells. We may place the stops above the resistance as per our risk management.

Both the EMA's are bearish and have a bearish death cross. Better the circumstances of EMA being bearish as our sentiment is already bearish. The retest of the EMA will turn out to be in confluence with other technical factors for us to take a short position.

Both the oscillators are in a bearish region below the neutralized levels. These levels need to be at the neutralized levels once the market retraces at the resistance or retracement. After this neutralization, we will be looking to short.

After the NFP previous friday, market needed time to absorb the positive news impact of the NFP. This news impact has been factored in today on a bearish side once the pre-london was started.

Gold short opportunity forming

Vasl Capital

May 09 2022

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