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Gold Ready for Downward Thrust?

August 9, 2015 at 20:09 by Andriy Moraru

Although gold is still trading at historically high levels (above $1,000 per troy ounce), it is heading down in a long-term bearish trend since September 2011. The most recent downward wave lasted from May 2015 through mid-July. It looks like the consolidation pattern chosen by the precious metal is about to give in to a further decline according to our technical analysis.

You can see the symmetrical triangle formed since July 20 holding well through the latest trading session. The triangle is marked with the yellow lines. It is following a bearish trend, which means that the probable breakout of the continuation pattern is to the south. A potential entry level is marked with the cyan line. The green inclined line suggests a take-profit level that can be used with this short position. Setting a stop-loss to the high of the breakout bar could serve as a risk-limiting option here. Bullish breakout is not considered as a viable entry signal in this symmetrical triangle. You can click on the image to see a full-size screenshot of the chart:

Gold - Symmetrical Triangle on Daily Chart as of 2015-08-09

You can download the MetaTrader 4 chart template for this pattern.

If you have any questions or comments regarding this chart pattern for copper, please feel free to reply below.

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