GOLD - a trend reversal sign ?

R

rajivkhatlawala

Member
#1
#1
Is GOLD REVERSING its TREND ???

Gold is forming what is technically called a "Head and Shoulder" formation. This is a trend reversal pattern suggesting a halt in the bullish trend .

The crucial level (based on the 'neckline' formation, to be watched is the Rs.11500 level on Gold M contract. A break and close below this should lead us to the vicinity of the technical target of Rs 10000/-

The whole pattern will get negated now only on price rising above Rs.12350/-

Surely a security worth watching - even if you don't trade in Gold !!

Happy trading !
CA Rajiv D Khatlawala
 
Last edited:
C

CreditViolet

Guest
#2
#2
rajivkhatlawala said:
Is GOLD REVERSING its TREND ???

Gold is forming what is technically called a "Head and Shoulder" formation. This is a trend reversal pattern suggesting a halt in the bullish trend .

The crucial level (based on the 'neckline' formation, to be watched is the Rs.11500 level on Gold M contract. A break and close below this should lead us to the vicinity of the technical target of Rs 10000/-

The whole pattern will get negated now only on price rising above Rs.12350/-

Surely a security worth watching - even if you don't trade in Gold !!

Happy trading !
CA Rajiv D Khatlawala
Click to expand...
Are you aware of the reliability of the H&S pattern?
 
R

rajivkhatlawala

Member
#4
#4
Dear oxusmorouz - Thanks for the link - seems interesting

I presume major markets usually reverse after a H & S formation. Even the Technology stocks reversed in the year 2000 after making a H&S formation...

More recently - H & S formation was very effective in reversing the rally in RPL after it touched a high of 290+... (this one i remember - but there may be other stocks too)

Surely time will tell whether it works equally in Gold ( which is a 'more tradable market' than Indian stocks / Indices)

CA Rajiv
 
D

darsh_goswami

Guest
#7
#7
kkseal said:
That's not a H&S pattern in the first place The 2 'shoulders' are too far away from the Head.
Click to expand...
Agree with you kkseal ,..

Volume is a major player while detecting or trading HnS pattern. Here no volume data provided ,.. neither from looks also it seems that its head n shoulder ,.. yeah but we can surely say if it breaches ur support line ( in ur words neck line) then we can see a fall atleast upto 700 to 800 points into it.

So better for those who r shorting it or who wants to buy physical Gold ,.. hehe ,.. i dont have money to buy ... lol

Regards,..
Darsh
 
R

rajivkhatlawala

Member
#8
#8
Gold breaks 'neckline' and touches 11220 levels . . . kkseal / darsh ... any comments ???


darsh_goswami said:
Agree with you kkseal ,..

Volume is a major player while detecting or trading HnS pattern. Here no volume data provided ,.. neither from looks also it seems that its head n shoulder ,.. yeah but we can surely say if it breaches ur support line ( in ur words neck line) then we can see a fall atleast upto 700 to 800 points into it.

So better for those who r shorting it or who wants to buy physical Gold ,.. hehe ,.. i dont have money to buy ... lol

Regards,..
Darsh
Click to expand...
 
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