XAUUSD (GOLD)

The previous short term short position played out very nicely with a quick momentum shift and bearish to bullish trend change that soon followed. Current price action is the typical confluences that we would expect for a long position. We can first identify that the trend has changed from bearish to bullish, secondly we can also identify the bullish pattern which is the inverted head and shoulders with price action breaking out of the neckline and now retesting. The breakout of the pattern was with momentum creating the push phase, naturally after a push phase we can anticipate the exhaustion phase to begin which is the current market phase we are in. A 1 hour time frame bullish engulfing candle has already been confirmed at the short zone, a 2nd rejection or lower time frame trend change will be the preferred go to entry confirmation. If price breaks back below the proposed neckline longs will not be valid until price is trading back above said level.