CFD GOLD - Trading Levels

US Gold CFD: 1638
The pattern on the MediumLevel 1650 from the 26 Sept has the bias of being corrective, that said from a trading point of view the 1650 is the line in the sand for being long or short.
Long winded sideways patterns tend to make us look elsewhere for trades as we tend to simply get bored of the market going no-where, but from experience this is the time to really focus in what’s happening.
I can see the pattern in three different ways two bearish and one bullish and within the next two sessions I we be able to give confirmation on a trade direction from the pattern and from the tradinglevels. The tradinglevels will firstly work from the 1650, I can say at this point if the price gets stuck in the subgroup1 of 1600 (SG11610 I 1620 I 1630) then the trade is down, when working with SG1 from above it’s the centre that’s important the 1620 as the retested resistance, this is normally the last struggle point before chipping away at the nearest largest price in this case 1600.
The long side trade would need to be above 1650 as support and support comes from a series of retesting the 1650, this is where you would scale in the first trade, the second part of the trade comes from working through subgroup2 SG2 (1665 I 1672 I 1680) there will be resistance at 1665 but one the market has worked through this you will be looking at 1672 (centre pivot) as the retested support to add the second position, you can also add on 1680 but realise that this area is likely to be checked again from the abc correction that will occur at 1700 in fact it’s the 1672 that will be tested. After the correction at 1700 you can add again, but if you’re unsure then work the 1720 as the support.
All of what I have said are the basics for working through these type of levels which you can apply to others, there is of course other aspects to take into consideration, this is only working with price.
Another important element is the size of the previous pattern, as bigger the corrective pattern the bigger the trend that will come out of it.