I feel the need to explain the behavior of XAUUSD based on historic evidence and trend cycle analysis.
- All instruments in the market must undergo an Accumulation-Participation-Distribution cycle and gold is no different.
- Each accumulation and distribution is supplemented by a reversal pattern, as you can see in my chart, we have a descending triangle, an ascending triangle and a recent Double tops. No reversal can ever be random or without a warning pattern.
- Now the point where we are at XAUUSD, we are just had a reversal confirmation and a double tops pattern breakout and also the major relevant Darvas box breakout (that is two PAs right on the screen). We have successfully entered and initiated the downtrend public participation phase on our favorite metal heading towards lower target zone in the base target of double tops.
- Macroeconomy: No major move, on the USD-based market assets, can happen without the help of changing economy dynamics of the FEDs. We are witnessing USA bailing out on the debtors (Public, companies and other countries) in attempts to retract dollar back to the federal reserve. They have adopted aggressive rate hikes as an instrument to get their money back to the center. This measure in veiled as an attempt to counter inflation and restrain it back to below 2% target levels. Therefore, the strengthening USD is the major contributing factor to the downtrend of XAUUSD.
- There is not reason, so far, to buy gold and keep it as a hedging asset against inflation today and for several months to come.
- We will see later if trend dynamics change for Gold later and I will update you accordingly, till then, keep short on gold.
- Also see related ideas in junction with this idea to have a better understand of this idea.
- All instruments in the market must undergo an Accumulation-Participation-Distribution cycle and gold is no different.
- Each accumulation and distribution is supplemented by a reversal pattern, as you can see in my chart, we have a descending triangle, an ascending triangle and a recent Double tops. No reversal can ever be random or without a warning pattern.
- Now the point where we are at XAUUSD, we are just had a reversal confirmation and a double tops pattern breakout and also the major relevant Darvas box breakout (that is two PAs right on the screen). We have successfully entered and initiated the downtrend public participation phase on our favorite metal heading towards lower target zone in the base target of double tops.
- Macroeconomy: No major move, on the USD-based market assets, can happen without the help of changing economy dynamics of the FEDs. We are witnessing USA bailing out on the debtors (Public, companies and other countries) in attempts to retract dollar back to the federal reserve. They have adopted aggressive rate hikes as an instrument to get their money back to the center. This measure in veiled as an attempt to counter inflation and restrain it back to below 2% target levels. Therefore, the strengthening USD is the major contributing factor to the downtrend of XAUUSD.
- There is not reason, so far, to buy gold and keep it as a hedging asset against inflation today and for several months to come.
- We will see later if trend dynamics change for Gold later and I will update you accordingly, till then, keep short on gold.
- Also see related ideas in junction with this idea to have a better understand of this idea.
