After a sharp decline in the previous session, XAUUSD has shown a mild recovery and is currently trading around 3,332 USD. However, price action suggests this could merely be a pullback within a broader downtrend, as gold has yet to break above the key resistance zone.
Technical Analysis
Price Action
Gold has bounced from the support zone between 3,291 – 3,317 USD, which has historically acted as a strong demand area. This zone also aligns with the Fibonacci 0.382 retracement from the previous bullish leg.
However, XAUUSD remains below the key resistance zone at 3,373 – 3,392 USD, which is a confluence of:
– The Fibonacci 0.618 retracement from the most recent downtrend
– A historical supply zone that has been rejected multiple times
– The upper boundary of the sideways range formed since May
– If price fails to break through this zone in the coming sessions, the risk of continued downside remains high.
RSI Indicator
– The RSI (14) is currently hovering around the neutral zone (49-54), indicating that the rebound lacks the strength needed to confirm a trend reversal.
– The RSI has not crossed above the 55 threshold, suggesting the dominant trend is still bearish.
Key Technical Levels to Watch
Resistance:
– 3,373 – 3,392 USD: Confluent resistance zone (Fibonacci 0.618 + prior supply zone)
– 3,435 – 3,452 USD: Major swing high, a key medium-term reference level
Support:
– 3,291 – 3,317 USD: Immediate support zone, still holding strong
– 3,250 – 3,224 USD: Potential downside target if the bearish momentum resumes
Suggested Trade Setups
Scenario 1 – Buy if price holds above 3,291 and shows confirmation signals
Entry: 3,295 – 3,300 USD
Stop-loss: Below 3,289 USD
Take-profit: 3,340 – 3,355 – 3,370 USD
Conditions: Must show clear bullish reversal patterns (Pin Bar, Bullish Engulfing) on H1 or H4 timeframe
Scenario 2 – Sell if price rejects from resistance zone with confirmation candle
Entry: 3,370 – 3,375 USD
Stop-loss: Above 3,392 USD
Take-profit: 3,330 – 3,310 – 3,290 USD
Conditions: Clear bearish rejection candle + declining volume
Note: XAUUSD is currently in a technical rebound phase after a strong drop but lacks solid reversal confirmation. Traders should closely monitor the price reaction near the 3,373 – 3,392 USD resistance zone over the next sessions. This area will determine whether the downtrend will resume or a reversal begins.
Stay tuned for more daily trading strategies, and make sure to save this analysis if you find it helpful for your trading plan.
Strategy analysis by Henrybillion
