The February Gold has reached the descending median line and fullfilled the critera for the reversal signal, triggered by the January 4th reversal date. Gold traded lower into the January 6th reversal date and tested the median line support, setting up a potential reversal. (A market will typically reverse at the media line.) The next day, Gold traded below the reversal date low on the “trail day”–the day following a reversal date that can act as a strong directional indicator–and is currently challenging the reversal date high. A trade above the reversal date high would confirm the reversal signal pattern and portend a corrective rally into next week.
For more about using ‘action-reaction” and in conjunction with reversal dates to identify swing trading strategies go to www.tradersnetwork.com.
