by ZenTrader, Gold Silver Worlds:
Nobody ever said riding gold would be easy and Friday was a perfect example of that. No doubt gold can be a heart-breaker and it’s obvious the short traders went after those who entered with Thursday’s break or who over-leveraged their hand. The newly minted longs from that bullish breakout of the ascending triangle were the target on that sell-off. Because it has been such a long grinding bear market, longs are still weak handed and skittish. That’s why we find all major rallies out of lows riddled with sharp 1-2 session sell-offs and it’s why Investors need to widen their horizon when trading it.
I mentioned in Thursday’s trade alert that we could expect a back-testing sell-off from that breakout, and that would be normal. But I did not expect to see anything more than a retest of the breakout line around $1,394. I certainly did not see a move all the way back into the ascending triangle. So this week will be an important week for gold because if this is a Left Translated Cycle, then Friday morning would certainly have marked the top of this Daily Cycle. In that case, gold will fall right through the bottom of this triangle pattern and not look back.
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