the gold market on the 4-hour chart remains at a critical juncture. The price, after a prolonged ranging phase, is now approaching a key resistance zone at $3,425 – $3,450 (highlighted in the red box). This area has previously acted as a strong barrier, pushing prices lower and preventing further bullish continuation.
Change of Character (CHoCH) and the Start of a New Move
At the start of the chart, a Change of Character (CHoCH) is visible, signaling a shift from a bearish to a bullish trend. Following this shift, gold entered an ascending channel, forming higher highs and higher lows.
Channel Break and Range Formation
After a sharp rise, the price broke below the ascending channel and entered a sideways range. This range is clearly defined between the $3,225 support level and the $3,450 resistance level.
Current Situation: Bullish Pressure Near Resistance
This week, price action has formed an ascending triangle pattern heading toward the resistance zone. This pattern indicates strong buying pressure and the potential for an upside breakout. However, the presence of the $3,425 – $3,450 supply zone increases the risk of a bearish reaction from this level.
Possible Scenarios
- Bullish Scenario: If the price breaks and holds above $3,450, the next bullish targets would be $3,520 and then $3,550.
- Bearish Scenario: Failure to break the resistance may lead to a pullback toward $3,350, and if bearish momentum strengthens, a further drop toward $3,225 is possible.
Conclusion
Gold is currently in a high-risk area, and traders should closely monitor price action around the $3,425 – $3,450 resistance zone. Entering trades prematurely here could be risky, and the safest approach is to wait for confirmation of either a breakout or a rejection before taking a position.
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