An expert trader performs a technical analysis of the gold market, using multi-time frames and commitment of traders data to predict a potential trading opportunity. The market currently shows signs of a potential correction before a continuation of upside momentum, which aligns with both technical and fundamental perspectives. The trader advises a reactive approach, waiting for intraday bullish signals before entering a long position with good risk-to-reward ratios.

Analyzing Gold for a Trading Opportunity: A Technical and Fundamental Breakdown

Introduction

In this video and article, we will analyze the Gold commodity for a potential trading opportunity. The author, Nick, is a top author on TradingView with over 250,000 reputation points. He shares educational breakdowns to help traders identify the best trading opportunities in the market. Our analysis of Gold will be based on a multi-time frame technical analysis along with the commitment of traders (COT) report to identify the highest probabilities for a trade in this market.

Monthly Time Frame Analysis

The monthly time frame shows a strong impulse to the upside followed by a first retracement leg. The market then tried continuing higher but broke back down to create a lower low. Currently, the market is breaking back above to reach the previous high. This pattern is called an impulse with a complex correction. After an impulse in a correction, you can expect a continuation to the upside. Furthermore, from a fundamental perspective, Gold is a good hedge against inflation, which should drive Gold prices higher. Therefore, from a technical and fundamental perspective, Gold is expected to provide more continuation to the upside.

Weekly Time Frame Analysis

The weekly time frame shows the market testing the previous resistance turned support and providing a strong rejection to the upside. After breaking the previous resistance to the upside, it now turned into support. This level is where the market tested and resulted in a strong impulse to the upside. However, a correction is still expected before the continuation to the upside.

Daily Time Frame Analysis

The daily time frame shows that the market is currently overextended after the impulse. Fibonacci retracements of 0.32 and 0.50 line up with the previous supply levels where we have quite strong demand and support. This is in confluence with the 0.32 and 0.50 Fibonacci retracements taken on this daily impulse. A correction to this area is expected to grab some liquidity before the continuation to the upside. This area is where we should be looking for potential trading opportunities.

Commitment of Traders (COT) Report Analysis

The net positions of institutional traders in the Gold market have been increasing, indicating a bullish sentiment towards Gold. Long positions are increasing, and shorts are decreasing, with the total net position increasing from 170k to 198k. This aligns with our technical analysis that suggests Gold is expected to provide more continuation to the upside.

Potential Trading Opportunity

From a technical and fundamental perspective, Gold provides a potential trading opportunity to the upside. We will be reactive and not predictive, waiting for the market to shift from an intraday bearish to an intraday bullish market inside the 0.32 and 0.50 Fibonacci retracement zone. Students will monitor the price action from the 4-hour and other intraday time frames, waiting for a valid entry signal to take a long position with a good risk to reward and probabilities for the move to the upside.

Conclusion

Gold shows potential for more continuation to the upside based on our technical and fundamental analysis. Long positions held by institutional traders in the COT report align with our expectation of a bullish sentiment towards Gold. A correction is expected before continuing to the upside, and the 0.32 and 0.50 Fibonacci retracement zone is where we should be looking for a potential trading opportunity. By using a combination of technical and fundamental analysis, traders can identify the best trading opportunities in the market.