In my previous post on gold Gold Market: More Downside, i pointed out that a weekly candle had closed below 50 wma since 2019. But i also reminded the readers that there's a danger that i wrote the post 1 day before the end of week. Because by the end of week, that candle may close back above the 50 wma. And it did.
I had an egg on my face, it seemed. But if that candle turned out to be a bear trap, prices should break out above of the falling trend line or resistance. Instead it gapped down a week later. So it's not a bear trap, but a trap of bear trap. In other words, it makes you think it's a bear trap, but it's not! It's a bear signal.
I did say in that post that i don't rely on only 1 signal to call the downside. I relied on many other technical indicators, as well as fundamental reasons that i mentioned some in the post.
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(Click chart to enlarge) |