The precious Yellow metal is recent talk in the town. From the beginning of 2017 till to date, Price is rising sharply. Gold is currently trading around 1220.00 in International Spot market. (Pretty much the Movements in MCX and Spot market are same)
We have a counter trend trading setup on Gold in 4h chart. My clients and students are well aware of this setup; also they know the probability of this Price action pattern. (Kindly have a look at the chart to make sense). Though the chart is screaming to take sell position, (based on potential risk: reward) I am quite hesitative! Why? Because of three reasons 1) The Sentiment is still bullish on Gold 2) Seasonality is positive for Gold in Jan and Feb based on Historical statistics. 3) The trend may run further if macro factors support it.
So there is a Dilemma, whether to take this counter trend price action setup (Trading against the Trend) or look for a pattern failure (Respecting the Trend). To make a Proper choice, I would watch the price action for next few days, if there is a sharp movement on either side – I would trade on that side with tight stop loss and Risk management. Lookout for this Price action trading opportunity in Gold
