On August 10, gold staged a strong one-way bullish rally last Friday, steadily climbing during the Asian and European sessions before accelerating on the U.S. nonfarm payrolls data, hitting a daily high of $4,371 per ounce, with the daily chart closing firmly as a large bullish candle. An early morning long position at $4,242 was closed near $4,265 for a profit, and before the U.S. session, a long entry at $4,311 was taken, relying on the $4,300 level to anticipate the nonfarm payrolls rally, which aligned perfectly with expectations. After the data release, prices surged sharply, jumping $70 in one go.
The value of trend trading lies not only in capturing profits but also in the comfort of having a strong directional bias. Even if the entry price is not perfect, with some deviation, as long as the overall trend is correct, the probability of profit remains high. This is the confidence of following the trend and the core of our trading strategy.
The weekly chart closed with a strong bullish candle, and the daily chart also ended with a large bullish candle, clearly establishing a bullish pattern. This week, the strategy should continue to focus on buying on dips, but the key question is how to do so: Whether to buy aggressively on strength or to wait for pullbacks?
After Friday's U.S. session, gold pulled back from its peak at $4,371 and consolidated. This morning, the price continued to adjust, currently trading around $4,316. The primary support level remains the $4,300 round number. A pullback near $4,300 is a good entry point for a long position, with a stop-loss below $4,285 and a target of around $50. If the price stabilizes above $4,300, forming a holding pattern, then a long position can be actively taken around $4,310 with a stop-loss just below $4,300. Once the high of $4,371 is broken, the upside will expand further, and following that breakout, the bullish trend should continue to be followed.
This article is for general reference only and does not constitute investment advice. Investors should bear their own risks when acting on it.