The Bottom of Gold? Or more doom?

The Bottom of Gold? Or more doom?

Recently we saw a diabolical drop in the price of Gold. A wave of sell orders in a one-minute period shortly after the Shanghai Gold Exchange opened Monday July20th sent the most-active U.S. gold futures contract down $48 to as low as $1,080 per ounce, its weakest since February 2010.

Within two minutes, an estimated 33 tonnes of gold in Shanghai and New York worth $1.3 billion changed hands. A lack of liquidity, with Japanese markets closed for a holiday, hastened the slide. Turnover in Shanghai and New York were tremendous. A record 3.3 million lots traded on a key contract on the Shanghai Gold Exchange, compared with fewer than 27,000 lots on Friday, Reuters data showed. Before Monday, the volume for July had averaged fewer than 30,000 lots.

This is the drop highlighted for those who would like to see it on a chart.

Gold Drop 

Now. That drop took us to lows we havent seen for around 5 years.. Gold may have bottomed there. It may be now trying to slowly and steadily claw ts way back up to that lovely level of $1200.

Gold Retracement

I may be wrong though.. I often am. The smarter thing to do would be to trade with the trend and look through the bigger timeframes and break that down, it could change your whole trade... I should do that, brb.. 

OK! Im back and ive had a look at the day chart! Now my complete opinon on the matter has changed, its crazy what looking at different timeframes can do to your decisions. I like to rely on bigger timeframes because i find them a lot more reliable It will be nice to see how it plays out.

Gold 1Day Chart

 If Gold does decide to continue in this bearish trend then we may see lows of $1040. At which point i will be looking to BUY with my life.

Gold 1040?

This is just me sharing some of my thought process when breaking down a trade, made simple.