Gold: 2022: A double top, then a story of altitude sickness

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Gold is an unparallel commodity in terms of its position of market cap, standing at the top with a market cap of 11.492 trillion USD. Crypto is considered an emerging asset with Bitcoin sitting at 16th rank with a market cap of 391 Million USD. On the top 100 assets, Ethereum is another such cryptocurrency to feature at 81st rank with a market cap of 141 Billion USD.

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This year was indeed a volatile year with a multitude of reasons to shake the entire economic fabric-- the geopolitical tension, massive inflation, fear of stagflation, etc all across the globe.

Since the start of the first and second quarters, the Gold bull did not hesitate to print the double top in the chart and refresh it around 2070, but since then t has been a story of altitude sickness. It does not make a difference if you are a news trader or not, or if you are an expert TA trader or not, as long as you have a long-term plan and have certain defined areas which you keep monitoring, you can make your investment count every now and then.

Gold, the way it has traded in 2022 is a classic example of how a double top is formed, and how a double top is a reversal sign. Just like the Bitcoin cycles, what Gold has been trading off late is a classic example of a Gold cycle. The rally started during the COVID-19 pandemic, from the 1450 level it made a one-sided journey towards the 2070 level, then corrected towards 1670-1680 level and after several months of consolidation, again made a massive rally to print a double top in the chart at 2070 level in 2022 and since then it has given up all the major support level, signifying a firm bear trend at the moment.

In the weekly chart, there has been head and shoulder formation, on the other hand, in the monthly chart there is a clear double top formation. Both the Weekly and Monthly charts are playing out nicely in favor of bears technically.

1780 Level was significant support, during this entire bull run since 2020. But Gold has already given up that level and the long bearish candle, in a single day lost more than 40 USD(from 1805 to 1765), followed by another bearish daily candle to trade as low as 1730 certainly marks the beginning of a different range altogether.

However, it is not done yet. The multi-year support is sitting at the 1650 level, before that another major support 1680 might be tested by Gold in the coming days. So a new range has opened up with the recent plunge and this range could be traded to make some money playing Gold. That range ideally should be between 1680 to 1780 level. 1780 level is now going to be a massive massive resistance.

1650 level also aligns with the 200 SMA, and considering the monthly chart playing out nicely(bearish), in the coming months, Gold is all set to witness this level.

Disclaimer:- This article is intended for educational and analytical purposes only. It should not be construed as financial advice. Thank you.