Remember that XAU/USD symmetrical triangle we were watching a while back?
The precious metal just busted through its long-term triangle resistance and could be gearing up for another massive rally.
How high can it go?
Gold (XAU/USD): 4-hour
Gold (XAU/USD) 4-hour Chart by TradingView
A surge in safe-haven flows early this week has propelled gold past its triangle resistance on the 4-hour time frame, possibly setting up for an uptrend that’s the same height as the chart pattern.
However, price looks ready for a quick correction as resistance close to R1 ($4,281.81) seems to be holding.
Are more gold bugs waiting to hop in at these retracement levels?
The 38.2% level lines up neatly with the pivot point level ($4,160.91) while the 50% Fib appears to be more aligned with the broken triangle top that could now hold as support.Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your fundie homework on gold and the U.S. dollar, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
Look out for reversal candlesticks suggesting that the area of interest could hold as support, potentially lifting XAU/USD back up to the swing high or to the record highs near R2 ($4,347.81).
On the other hand, keep your eyes peeled for a move below the Fib levels and triangle support, as this could signal that bears are regaining the upper hand or that further sideways action could follow.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment.
Disclaimer:
Please be aware that the technical analysis content provided herein is for informational and educational purposes only. It should not be construed as trading advice or a suggestion of any specific directional bias. Technical analysis is just one aspect of a comprehensive trading strategy. The technical setups discussed are intended to highlight potential areas of interest that other traders may be observing. Ultimately, all trading decisions, risk management strategies, and their resulting outcomes are the sole responsibility of each individual trader. Please trade responsibly.