XAUUSD Broke below the 4H MA200 after 3 months! What’s next? for FX_IDC:XAUUSD by TradingShot
The long-term bullish trend hasn’t been broken yet but is loosely supported after the 4H MA200 break on the Channel Up that started on November 10. Practically the 1D MA50 (red trend-line) just below is the true test of the uptrend. The 4H MA200 is now a Resistance but with the 4H RSI getting oversold and rebounding, it is likely to see a bullish market reaction (the last if this is the start of a downtrend) towards the 4H MA50 (blue trend-line) as the current price is the lowest in a month.
A rejection on the 4H MA50 practically empowers the trend reversal but the true confirmation would be closing a day below the 1D MA50. The role of the Support Zones we display is crucial as they were both Resistance and Support levels previously. As you see currently the price is support on Zone 2. As a result we are willing to sell only below the 1D MA50 and target Support Zone 3. Below that we will target the 1D MA200 (yellow trend-line).
In order to resume buying, we need to see the price break above the 0.5 Fibonacci retracement level again, which is both a bullish break-out point and rebound point inside the Channel Up.
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