Gold: May low breached as bearish pressure brings prices towards potential support on 1163.00 just above today's low
The daily candle chart below shows the price history of Gold over the medium term. This Contract for Difference (CFD) aims to track the underlying spot price of the precious metal Gold, and is trading near 1163.55 around time of publication today and near fresh session lows.
Last time Gold was reviewed in Ideas You Can Trade in April - bearish pressure was again the theme and prices subsequently traded lower before recovering from 1169.00 on May 1st and then returning towards 1200.00. Since then 1200.00 was lost, and the trend has been bearish with the May 1st bottom breached today, and with support tested near today's low.
If support holds above 1163.00 then a rebound could follow, whereas if this area is lost then the 1150.00 range may be next, as the overall medium term trend still appears to be within an overall bearish channel.
Below are examples of how to trade a bearish continuation or a bullish reversal:
1. BULLISH BUY ENTRY ORDER: Create a “Buy Entry Stop” @ 1170.00 with a Limit to take profit @ 1172.00 and a stop-loss @ 1168.00 Risk/Reward Summary: Limit risk = 2.00 Profit / (-2.00) stop-loss risk = Gain to Loss ratio = 1.00
2. BEARISH SELL ENTRY ORDER: Create a “Sell Entry Stop” @ 1163.90 with a Limit to take profit @ 1160.50 and a stop-loss @ 1167.00 Risk/Reward Summary: Limit risk = profit 3.40/ (-3.10) Stop-loss risk = Gain to Loss Ratio = 1.09
Medium Term Daily Candle Chart:
Medium Term Daily Candle Chart (zoomed-out):