Gold at 4,150 breakout pullback — hold for 4,170 or fail back to 4,124? Oct 6

Hey everyone, Daniel here, active prop trader. Short-term on gold I'm leaning bullish today. Since last time the downtrend kept running right in line with my bias, and after the last update we saw another drop of roughly 521 pips play out.

Right now we've bounced hard off the lows and broken above the recent high, but this latest big bullish candle could turn out to be a climax bar, so stay cautious. For longs, I'd rather wait for a breakout pullback to that broken level before looking to buy in. The key question is whether the breakout pullback holds and the uptrend continues from here, or the breakout fails and price rolls over and drops again — that's exactly what I wanted to focus on.

Alright, let's dive straight in and start with the daily chart first. On the daily chart, yesterday's candle closed as a bearish doji, and the scenario I laid out for you at that point yesterday was this. First off, with that prior candle closing as a bearish doji, I told you the market was still stuck in a sideways range and hadn't picked a direction yet.

And since the last two sessions printed an outside bar that fully engulfs the prior candles, I pointed out there's a strong chance the market has reset and is starting fresh from here. So the game plan hasn't changed from last week. Centered on that doji, I'm first expecting a trading range is likely to form here, and keeping that in mind.

After a breakout, the plan is to wait for the breakout pullback first, and only then consider trading outside the range — that's what I covered. In the end the candle closed as a bearish doji that sits completely inside the prior day's range, so just as the scenario called for, the trading range is still intact and continuing. Today we saw a similar move that dipped below the recent swing low, but for any play that actually breaks beyond the range width, the right approach is to wait for a clear breakout and pullback before entering a position.

With so many doji candles stacking up and this endless string of range after range after range, I've decided it's better not to force any new strategy change here and just stay patient. So let's shift over to the 1H timeframe now. On the 1H, the broadcast I ran for our community members the previous day came right here, at this red line, exactly at this spot on the chart.

On YouTube, I want to walk you through what I shared with our community members at that point — the scenario breakdown and the technical analysis, focusing on the key points. As for my bias, after that strong downswing we got the second bearish reversal candle, so my read was that the market stayed fundamentally skewed to the downside, and that's what I told members. As for how far it could drop, as of yesterday the prior day's low and the low printed in the Tokyo session were clustered right around 4125, so I told members this zone was the one to watch — a natural short-term downside target where price would likely draw attention.

On the flip side, for a move the other way, this second reversal candle is my basis for selling here, so if price breaks up through it, I'll flip my bias to the upside instead. I walked through a scenario of waiting for the breakout and pullback before entering. I also broke down the whole thought process that led me to this decision.

What really stands out is this bearish doji candle that formed the prior day. This doji formed right at the open of the London session. After a strong bullish candle broke above this doji to the upside, as for trading here, this is something I actually covered in the last video.

I said to basically wait for a breakout and pullback before entering here. That's because sideways ranges often drag on far longer than most of us traders expect. So rather than chasing a breakout the moment it fires and assuming it'll keep running, I think the smarter play is to wait for price to reverse at the next key level and enter there.

That was the thinking behind my plan. And sure enough, it formed a bearish reversal candle, the breakout failed, and price finally broke down below this range. The final range width was right here, and after that you can clearly see price moving as a breakout-pullback setup.

Price carved out this downswing with really strong bearish momentum. After that we get a bullish reversal candle, but even though it's a bullish bar, it's pretty small and doesn't even erase 50% of the recent bearish candle, so this is just a weak bounce starting here. After that first weak bearish reversal candle forms, price turns back up and prints another bullish reversal candle right here.

An upside swing forms, and by the time of this broadcast we hit the second reversal candle here. Textbook-wise, we had such a clean downside swing here that the market could easily drop again by the same distance as that first downswing from earlier. Taking everything so far into account, we've basically been stuck in a daily-chart range, A realistic take-profit target sits right around here — the prior day's low, and the low printed in the Tokyo session.

As I pointed out, where those two levels overlap around 4125 tends to act as a key pivot point in the market. That was the scenario I had in mind, so now let's look at how price actually ended up moving. Just like this, right?

Price dropped exactly in line with my bias, and it ran all the way down to today's Tokyo session low. We saw a drop of roughly $52, about 521 pips, and even that first bounce stalled right at exactly $4125, hitting that level perfectly, so everything played out just as I had mapped it out. Overall, I think my scenario from the technical analysis lined up pretty well with how things actually played out today.

In today's community-only session, I walked through these three key points, laying out both the bullish and the bearish scenario for each one. First, we're making higher highs, so short-term's bullish. Second, momentum's strong but watch for a short-term reversal.

Third, don't chase price here. Wait for a clear pullback to confirm before you decide to enter. Since the community broadcast, price has moved on, and that big bullish candle is very likely acting as a climax candle marking the top here.

The first bearish doji inside this upswing formed right at the Tokyo session high, and that's exactly where price is now getting capped from above. From here I'll be watching closely whether we get a breakout and pullback move, or whether price reverses right here and starts dropping lower. That wraps up today's gold update.

Okay, one last thing to share with you. I run Trading Lab, an FX community built to get beginners profitable. Right now, just by joining our Telegram channel, anyone can watch all five of our members-only lessons.

And as a Trading Lab welcome bonus, I've just released a brand-new video that organizes my entire trading method into one complete lesson, the Daniel method. It's built so that beginners who have no idea where to start can learn to trade in a logical, structured way. In Trading Lab you get video lessons covering everything a beginner needs to start making money, from technical analysis to building trades and the right mindset, plus a Q&A room where you can ask me directly.

If you're tired of generic info products and signal videos that leave you stuck with no real progress, go ahead and check out the link in the description below. Let's grow together as traders every single day. Thanks so much for watching today.