Using Price Action to Buy Gold's Higher Low
- We integrated a macro-play by looking at Gold in response to the prospect of ‘looser for longer’ monetary policy response from Global Central Banks. We discussed that theme in far more depth in the article, Gold Prices Shine When Central Bankers Scurry into Action.
- This is a redux of the entry looked at two weeks ago in the article, Higher-Low Sets Top-Side Trend Re-Entry in Gold.
- If you want to learn more about price action or the methods discussed in this webinar, please check out The Forex Trader’s Guide to Price Action.
- If looking at long Gold, traders are also taking on short-USD risk, which given the continued bullishness of the Dollar, this could provide headwinds on the long Gold position. Traders can look to offset that risk by getting Long USD in another pair. We looked at EUR/USD and GBP/USD for those purposes.
- This strategy is called, ‘The US Dollar Hedge.’
- We closed by looking at the continued ascension in stock prices with the note that risk aversion is not like over yet.
--- Written by James Stanley, Analyst for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.