The 3065 price level is acting as a strong resistance zone for XAU/USD. Here’s why:
Previous Resistance Test: Gold has tested the 3065 level multiple times in recent weeks and has failed to break above it, resulting in price rejections. These rejections create a pattern where institutional and retail traders are likely to sell at or near this level, anticipating further downside.
Market Structure: The market structure suggests that the upward momentum may be weakening. A failure to break above 3065 could indicate that buyers are losing control and that a correction or downward movement may follow. A shift from an uptrend to a potential downtrend increases the probability of a successful short position at this resistance zone.
Overbought Conditions: Technical indicators like the Relative Strength Index (RSI) show that gold has been in overbought territory, especially near the 3065 price point. When an asset enters overbought conditions, it suggests that the price is unsustainably high and due for a correction, which provides further validation for a short entry near this level.
Psychological Level: The 3065 zone is also psychologically significant. Traders tend to place sell orders around round number levels or areas that have been historically hard to break through, making it a prime spot for a potential reversal.
Previous Resistance Test: Gold has tested the 3065 level multiple times in recent weeks and has failed to break above it, resulting in price rejections. These rejections create a pattern where institutional and retail traders are likely to sell at or near this level, anticipating further downside.
Market Structure: The market structure suggests that the upward momentum may be weakening. A failure to break above 3065 could indicate that buyers are losing control and that a correction or downward movement may follow. A shift from an uptrend to a potential downtrend increases the probability of a successful short position at this resistance zone.
Overbought Conditions: Technical indicators like the Relative Strength Index (RSI) show that gold has been in overbought territory, especially near the 3065 price point. When an asset enters overbought conditions, it suggests that the price is unsustainably high and due for a correction, which provides further validation for a short entry near this level.
Psychological Level: The 3065 zone is also psychologically significant. Traders tend to place sell orders around round number levels or areas that have been historically hard to break through, making it a prime spot for a potential reversal.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.