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Technical Analysis of the Stochastics Oscillator Technical

A lot of info can be gathered from the shapes and duration of the market tops and bottoms of the stochastic oscillator xauusd indicator.

How long gold stays either too high or too low is key to understanding how strong the market trends really are.

XAUUSD Market Tops

Narrow market top which does not reach very high above 80 %

Narrow tops signal weak bulls. Buyers lose ground fast to bears. This setup lets bears drive prices lower with little pushback from bulls.

Very high and wide market tops

A broad market peak shows bulls overpower bears. Any short pullback stays brief. On the stochastic oscillator, the retrace won't hit oversold zones. It bounces back to overbought levels fast.

XAUUSD Market Bottoms

A narrow market bottom that does not reach very deep below 20%

The narrow market bottom means that gold trading bears are weak in their attempt to push the price down, the trading bulls have gathered control of the price pretty fast so price movement upwards will continue for a period of time. And the upward trend direction will continue for a period of time.

Broad wide market bottoms

A broad market bottom indicates that the trading bears are extremely powerful and that the sellers are in charge of the price. As a result, any retracement upward will be brief.

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