Trading Analysis is Based on 3 Factors Common in the Trading Market:

1. Price Moves in Trends

Xauusd price movements follow trends. This means that after a gold trend has been established, the future price movement is more likely to be in the same direction as a gold trend than to be against it. Most gold strategies are based on this analysis concept - trend trading.

2. Price Movement Discounts Everything

Xauusd trading analysis only considers price movement and assumes that, at any given time, price reflects everything which has or could affect the instrument including even the fundamental factors. This only leaves the study of price, which is a product of the supply & demand for gold in the market.

3. History Tends to Repeat Itself

History repeats itself mainly in terms of price movement. Repetitive nature of gold market movements is attributed to traders investor psychology: in other words, trade participants tend to provide a consistent reaction to the market most of the time. Xauusd trading analysis uses gold chart patterns to analyze these price movements. Although these gold charts represent historical data they are still relevant because they illustrate chart patterns that often repeat themselves.

List of All Indicators - Analysis Described Course - Trading Analysis Guide

Understanding this analysis of the market can be a valuable gold tool in determining the trend of any market and assisting with entry and exit levels for your trades.

The goal of these trading analysis methods is to help traders determine when the market is trending, and when it's not. If the price is moving in one particular direction, then we want to be on board. If the gold is not moving in a particular direction, all you are going to do is lose money as you will get whipsawed around and this is not what we want as gold investors.

Unfortunately, many traders fight the trend and buy or sell in the opposite direction of a this gold trend direction, trying to pick a top or a gold market bottom, only to see the market move further in the direction of the trend.

Another common mistake gold traders often make is adding onto a losing gold position, averaging a loss. This is not a good strategy especially in a strongly trending market. It is something which experienced investors never do. The gold trend is your friend, never go against it.

This trading analysis studies alert investors of gold setups and there are no certainties in financial market. Profits come from using proven gold strategies and gold methods to find a trending market and taking trades in the same direction of the market trend.

With so many trading investors using similar gold tools, trading analysis can become a self fulfilling prophecy. If many trading investors use the same levels as a buying point, the price goes up as everyone will make similar trading analysis moves. However, the question is always how long these gold trading moves will last?

Understanding this analysis methods will give the charts some meaning when you look at them and apply trading analysis. Xauusd trading analysis will help you understand why certain price movements occurred.

Xauusd charts are used with technical indicators to look for chart patterns that have occurred in past under certain conditions. When these conditions are noted again, you can use the past chart patterns studies to make a buy or sell decision.

Learn Gold Analysis PDF

• Moving Averages Indicator
• RSI Indicator
• Stochastic Oscillator
• MACD Indicator
• Fibonacci Retracement Indicator
• Bollinger Bands Indicator

Most gold indicators are shown separately from the chart usually below it. This is because these indicators often use a different scale than that of the price chart.

Some of the indicators are shown on the price chart itself, such as Moving Averages and Bollinger bands - these indicators are referred to as price overlays.

Explanation of these indicators is found under the tutorial: List of All Indicators - Trading Analysis PDF - Trading Analysis Example

SUMMARY

1. Trading Analysis Relies on Defining Probabilities
2. Trading Analysis Uses History of Gold Price Patterns
3. Trading Analysis Uses Several Analytical Tools (Indicators)
4. Trading Analysis Uses Chart Patterns

Learn Analysis PDF

Most gold traders prefer analysis - learning the analysis methods also takes time to learn due to its nature which involves abiding by the trade technical rules.

To learn how to trade gold successfully, it is important that you understand the Three strategies, outlined below:

1. price moves will always follow a gold trend which can be identified by looking at the chart patterns or the candlesticks charts. If any gold trading investor tells you that you can also profit from the counter-trends consistently it will not be possible because the trend is the only proven method of making money in the market.

2. The market forces will drive the prices up or down depending on supply and demand. Xauusd trading analysis seeks to measure the demand supply of a gold instrument using various trading analysis tools and indicators. The demand supply is reflected in the price action. Therefore, by simply looking at the price movements themselves you can try and predict what direction the price is likely to move towards using one or two indicators - trading analysis indicators like the moving average or support and resistance levels indicators.

3. The gold market not only shows the history of the past prices, but will also follow the trend that was in place, until its gold trend direction reverses. Some very important gold indicators used to determine these gold market movements are Moving Averages, MACD and Bollinger Bands Gold Indicators.

When price starts to consolidate, which means there is no trend, you should use a different approach to analyze the market. You should use support and resistance levels and breakout gold strategies to analyze the ranging market prices.

When the market retraces, you should use patterns & indicators to analyze whether the current gold trend will continue or reverse.