Gold (XAU/USD) on the 4H timeframe appears to be transitioning from a corrective structure into a potential bullish continuation. After the sharp sell-off, price formed a base and has been printing higher highs and higher lows, indicating short-term strength. The recent pullback respected a minor demand zone, followed by a series of small consolidations (marked by the clustered candles), suggesting accumulation before a possible expansion. Price is now approaching a key intraday resistance area just below the marked bearish imbalance (FVG-D), which aligns with prior distribution.
If momentum sustains, a break above the immediate resistance could trigger a continuation toward the highlighted fair value gap, where liquidity is likely resting. However, this zone may also act as a reaction area, so partial profit-taking or rejection is possible upon first touch. On the downside, failure to hold the local demand could invalidate the bullish setup and lead to a revisit of the weekly gap area below. Overall, the bias remains cautiously bullish in the short term, contingent on holding current support and breaking overhead resistance cleanly.
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