Gold bounced. Is the drop over? Read the highs and lows
Gold bounced. Is the drop over? Most people buy a bounce like this, and get trapped. Don't guess. Check just two things: the highs, and the lows.
- Mark the highs: each bounce peaks lower = sellers show up earlier.
- Mark the lows: each dip goes deeper.
- Lower highs + lower lows = downtrend. Don't buy the dip.
- Trend may turn only after a higher low, then a break of the last lower high.
The real chart used in this lesson
Real XAUUSD 1-hour chart · Oct 16 – Oct 21
Quiz at the end: If gold drops back to this low, would you buy, wait, or sell?
Full transcript
Gold bounced. Is the drop over?
Most people buy a bounce like this, and get trapped. Don't guess. Check just two things: the highs, and the lows.
Step one: mark the highs. Every bounce peaks lower than the one before.
Lower highs mean sellers show up earlier on every bounce.
Step two: mark the lows. Every dip goes a little deeper.
Lower highs plus lower lows. That is a downtrend, and the bounce was just a pause.
So buying the dip here means fighting the trend.
When does buying make sense? Wait for two signs, in this order.
Sign one: a higher low. Price dips again, but stops above the last low.
Sign two: price breaks above the last lower high. On this chart, that is around 4132.
Until both happen, the sellers are in control. Don't buy the dip.
Save this. Lower highs and lower lows, don't buy the dip. A higher low, then a break of the last high, the trend may be turning.
Your turn. If gold drops back to this low, would you buy, wait, or sell? Comment below.
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AI-voiced; written and reviewed by the Borearis Research Team. For education only, not investment advice. Trading involves risk.