What is a Gold Trend Reversal Signal?
Trend Reversal Explanation & Definition of Trend Reversal
A trend reversal in gold trading is when the direction of prices change & start heading in the opposite market direction.
To identify this gold reversal setup traders use the trend reversal strategy of gold trend line break.
A trend reversal means that a up trend reverses and starts heading in a downward direction & for a down-trend reversal the down-trend reverses & starts moving in an upwards direction.
Because a trend reversal is a change in the overall movement of price & not based on the movement of one candlesticks, traders use the market trend reversal setup to determine when the trend has been reversed.
Up trend Reversal
When price breaks-out below the upwards trend-line (support) market will then move down-wards
Upward Trendline Break - Trend Reversal Explanation & Definition of Gold Trend Reversal
This trend reversal signal is considered to be confirmed with formation of a lower high of the price. This also provides a trading opportunity to sell once the trend line is broken - gold reversal.
Down trend Reversal
When price breaks above downward line (resistance) the price then will move up
Downward Trendline Break - Trend Reversal Explanation & Definition of Gold Trend Reversal
This trend reversal signal is considered to be confirmed with the formation of higher low. This reversal setup also provides a opportunity to execute a buy trade once the trend line is broken - trendline reversal trading signal.
Trend Reversal Strategy
After price has moved in a particular direction for an extended period of time within a trend it reaches a point where it stops moving within the market trend. When this occurs we say that the trend line has been broken and this is interpreted and analyzed as a trend reversal.
Since the trend line is the point of support or resistance & this point of support or resistance has been broken after a trend line break - we then expect the price to move toward the in the opposite trend market direction & this is interpreted and analyzed as a trend reversal.
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