How Do I Analyze XAUUSD Trend Reversal in XAUUSD?

How to Read a XAUUSD Trend Reversal in XAUUSD

In xauusd the trendline break signal is used to signify a market reversal signal. When a trend line is broken then it means that the momentum of the current trend is reducing & the current trend might reverse and start moving in the opposite direction or form a consolidation chart pattern before it reverses.

Gold Trend-Line Break

After price has moved in a particular direction for an extended period of time within a trend it gets-to a point where it stops moving within the trend. When this occurs we say the trend line has been broken.

Since the trendline is the point of support or resistance then we expect the market to move towards the opposite direction. When this happens traders will close the open trade which they had bought or sold. This is called xauusd taking profit.

Upward trend XAUUSD Reversal Signal

When price breaks-out upward trend-line (support) market will then move down or form a consolidation chart pattern before moving downwards.

What's Upwards XAUUSD Trend Reversal in XAUUSD? - What's XAUUSD Upwards Trend Reversal?

This upwards trend line break reversal signal is considered to be complete with reversal pattern setup of lower high is formed on the price chart. This also provides a trading opportunity open sell trade once the trend line broken.

Downwards trend XAUUSD Reversal

When price breaks downwards trend line (resistance) the market will then move up or form a consolidation pattern before heading upward.

What's Downward XAUUSD Trend Reversal in XAUUSD? - What's Downward Trend Reversal?

This downward trend line break reversal signal is considered to be complete with the xauusd reversal pattern of a higher low is formed. This also provides a trading opportunity to open buy trade once the downward trend line is broken.

NB: Sometimes when the price breaks its trend it may first of all consolidate before going in the opposite direction. Either way it is always good to xauusd trading take profit when the market trend direction reverses.

To trade this trend reversal setup as a trader once you open a new trade in direction of market trend reversal the price should immediately move in that direction, in a price break out manner. This means that the market should soon move in that direction without a lot of resistance.

If on the other hand the market doesn't immediately move in the direction of the price breakout then it is best to close out the open trade because it means the current trend is still holding.

Another tip is to wait for the trend-line to be broken and for the market to close above or below the trend-line so as to confirm this trend reversal.

What happens is most traders open trades waiting for reversal signal even before the prevailing trend is broken, only for the price to touch this trend line and for the current market trend direction to hold & xauusd to continue with the current market direction.

Therefore, when xauusd this trend reversal xauusd setup it's best to wait til the price break out has been confirmed by gold price closing above or below the trend line, based on the direction of market.

• Up-wards XAUUSD Market Direction Reversal - trend-line reversal signal is confirmed once the market closes below this upward trend line, this should be the correct time to open a sell trade, so as to avoid a xauusd fake out.

• Downwards XAUUSD Market Direction Reversal - trend-line reversal signal is confirmed once the market closes above the downwards trend line, this should be the correct time to open a buy trade, so as to avoid a xauusd fake out.

How Do You Interpret XAUUSD Trend Reversal in XAUUSD