While XAU/AUD continues to step higher from the last time we featured the commodity, price has dropped below the following 4 hour trend line:
How often do we see trend lines break like this, only to hit the first short term area of support and ping back higher. Nothing in forex trading is ‘textbook’ and this push down through the trend line could well just be the market cleaning out any stops or weak longs before it bounces and properly runs higher.
I’m much more inclined to wait and see if this first level of horizontal resistance holds and then zoom into an intraday chart to find an opportunity to long any retests. You know that if it holds, you’re likely to find support at the original trend line again.
Do you trade Gold? Have you ever given any thought to XAU/AUD rather than the more commonly traded XAU/USD?
Go live and take advantage of opportunity in all commodities on MT4.
Dane Williams – @VantageFX
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Source: Vantage FX Blog