I just wanted to post a quick trade update here.
Today, gold (XAU/USD) continued higher after breaking out yesterday when it closed above $1700, a psychological resistance level AND above its former high of $1703 on March 9.A high of $1747 was reached but gold wasn’t able to stay near its upper range (unlike yesterday) and closed at $1727 or +0.80%.
What worries me is the type of candle that’s formed. 😟
A shooting star! 🌠
As a refresher, a shooting star candlestick looks like this:
A shooting star is a bearish reversal pattern.
Let’s take a look at the daily chart of XAU/USD so I can show you.
I’ve highlighted the shooting star candle in yellow.
That worries me.Just in case this candle is a reversal candle, I’m going to protect more of my profits and tighten my stop further.
In yesterday’s trade update, I had moved my stop loss (SL) to 1609, which was right below last week’s low.
Now I’m going to move it up again to 1674, which is right below the breakout candle’s low.
My original entry was 1600 so this locks in $74 or 7,400 pips, a 4.63% gain.
If gold is really breaking out to the upside, then tightening my stop loss (SL) shouldn’t matter since it’ll never get hit, but seeing that long wick (or upper shadow) is making me question whether the bulls will follow through.
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