XAUUSD SHORT
I shall give my reasonings for this setup. I hope this helps you in your own trading journey. This may be one of the best setups in a long time.
Daily: Price closed below the 1790.75 level for 6 days in a row. Price formed an evening star with the middle of the ES being a shooting star cs. Yesterdays daily cs was a shooting star cs that spiked above 1790.75 and closed below it indicating that bearish pressure is itching to come back into the market.
4hour: From the ''bigger perspective'' price formed a LL and LH. Price sustained (closed below) the prev high and 1790.75 level for 3 days and 16 hours. Price formed two shooting star cs. After the second shooting star cs price pushed up abit higher still sustaining below the 1790 level and formed a double top which consisted of two hanging mans. The 78.6 level has also held beatifully with the -27 fib extension lining up cleanly with the 1763.5 level. Break and retest of trendline/channel aswell.
1 hour: After price tapped into 1790.75 it formed a dirty bearish engulfing cs during new york switch which engulfed 11 hours of pa taking out the previous intra HL. This formed a new intra LL and then price pushed up higher and sustained below this rejection to form a new intra LH. Can see that each high is closing lower than the previous one. The newest high which is an evening star was completed during london switch and thus i entered.
Fundamentals: A large spike in CPI left inflation at 39 year highs at 6.8%. The Fed needs to tackle inflation as high as this. They will most likely ease up on the quantitive easening and buy less t bonds and mortgage backed securites by 30 billion less per month. Less currency in the open market means usd strengthening. Also this gives room for interest rate hikes as early as march. All in all the high inflation will help make fed take decisions to raise interest rates which in turn will strengthen usd in the long run and will give strong short term volatility.
Daily: Price closed below the 1790.75 level for 6 days in a row. Price formed an evening star with the middle of the ES being a shooting star cs. Yesterdays daily cs was a shooting star cs that spiked above 1790.75 and closed below it indicating that bearish pressure is itching to come back into the market.
4hour: From the ''bigger perspective'' price formed a LL and LH. Price sustained (closed below) the prev high and 1790.75 level for 3 days and 16 hours. Price formed two shooting star cs. After the second shooting star cs price pushed up abit higher still sustaining below the 1790 level and formed a double top which consisted of two hanging mans. The 78.6 level has also held beatifully with the -27 fib extension lining up cleanly with the 1763.5 level. Break and retest of trendline/channel aswell.
1 hour: After price tapped into 1790.75 it formed a dirty bearish engulfing cs during new york switch which engulfed 11 hours of pa taking out the previous intra HL. This formed a new intra LL and then price pushed up higher and sustained below this rejection to form a new intra LH. Can see that each high is closing lower than the previous one. The newest high which is an evening star was completed during london switch and thus i entered.
Fundamentals: A large spike in CPI left inflation at 39 year highs at 6.8%. The Fed needs to tackle inflation as high as this. They will most likely ease up on the quantitive easening and buy less t bonds and mortgage backed securites by 30 billion less per month. Less currency in the open market means usd strengthening. Also this gives room for interest rate hikes as early as march. All in all the high inflation will help make fed take decisions to raise interest rates which in turn will strengthen usd in the long run and will give strong short term volatility.
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