We’ve been modelling a potential channel on gold which leads nicely up to our next entry zone. However this potential channel was broken to the upside yesterday and again today. Whilst this is good news for the target zone it is NOT good news for a potential short entry.
This is where the old saying “the trend is your friend” really comes into play and those who want to go short really should do so with extreme caution, stops and a high reward to risk ratio. Let’s see how this move plays out over the next week. If it settles down there could be a nice opportunity for a long entry at around 1840 which would lead up to the question mark zone around 1900. This entry would have a 5:1 reward/ risk ratio.
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