XAU/USD (Gold) – Bullish Reversal Trade Setup from Falling Wedge | 1H Chart Analysis
🔍 Market Context:
Gold (XAU/USD) has been experiencing a corrective move in recent sessions following a notable upward push. After reaching a resistance zone near $3,345–$3,373, the price retraced and formed a bullish falling wedge pattern, indicating a potential trend reversal or continuation of the broader bullish trend.
This analysis captures the current price behavior and outlines a well-structured long trading opportunity backed by price action, technical patterns, and key support/resistance zones.
📐 Chart Pattern Analysis:
📉 Falling Wedge (Bullish Reversal Pattern)
A falling wedge is identified, formed by two downward-sloping converging trendlines.
Price action within the wedge shows lower highs and lower lows, but the range narrows, showing a loss of selling momentum.
This pattern is often considered a precursor to bullish breakouts, particularly when it occurs after a corrective move in an uptrend.
✅ Bullish Breakout Confirmation
A breakout has occurred from the wedge to the upside.
The breakout is supported by a series of higher lows, adding weight to the bullish bias.
A small pullback to retest the breakout area provides an ideal entry point for long positions.
🧩 Key Technical Levels:
🔵 Support:
$3,276.95 has held as a strong horizontal support level, where price rebounded twice, forming a short-term bottom.
This level acts as the stop-loss anchor in the current setup.
🔴 Resistance:
First resistance at $3,346.87, which also serves as the first take-profit level (TP1). It coincides with a previous swing high.
Second resistance/target at $3,373.44, representing a more ambitious target aligning with a key supply zone.
📊 Trade Plan Overview:
Trade Direction: Long (Buy)
Entry Trigger: Breakout above falling wedge + retest confirmation
Stop Loss (SL): Below the support zone, around $3,276.95, to manage downside risk
Take Profit (TP1): $3,346.87 – the base of the recent resistance zone
Take Profit (TP2): $3,373.44 – full pattern target and previous structure high
🔄 Expected Price Movement:
Price breaks out of the wedge.
Pullback toward wedge resistance (now support).
Bullish continuation to TP1.
Potential consolidation or minor pullback.
Final push to TP2 if bullish momentum sustains.
📌 Risk Management Notes:
This setup offers a favorable risk-to-reward ratio, with a relatively tight SL and clear upside targets.
If price closes back inside the wedge, or breaks below support, the trade setup would be invalidated.
Volatility should be monitored around key U.S. economic data releases, especially given the proximity of the setup to market-moving events (as indicated on the chart).
📈 Technical Summary:
Element Value / Area
Pattern Type Falling Wedge (Bullish)
Timeframe 1 Hour (H1)
Entry Zone Post-breakout Retest
Stop Loss $3,276.95
Take Profit 1 $3,346.87
Take Profit 2 $3,373.44
Trend Bias Bullish
📣 Conclusion:
The XAU/USD 1H chart displays a classic bullish reversal structure with a falling wedge breakout. The setup is aligned with price action logic, key horizontal levels, and momentum shift cues. As long as the price remains above the support at $3,276.95, the outlook favors further upside movement, targeting $3,346 and $3,373 respectively.
This trade idea provides a clean, structured opportunity with defined entry, target, and risk levels — suitable for both intraday and short-term swing traders.
🔍 Market Context:
Gold (XAU/USD) has been experiencing a corrective move in recent sessions following a notable upward push. After reaching a resistance zone near $3,345–$3,373, the price retraced and formed a bullish falling wedge pattern, indicating a potential trend reversal or continuation of the broader bullish trend.
This analysis captures the current price behavior and outlines a well-structured long trading opportunity backed by price action, technical patterns, and key support/resistance zones.
📐 Chart Pattern Analysis:
📉 Falling Wedge (Bullish Reversal Pattern)
A falling wedge is identified, formed by two downward-sloping converging trendlines.
Price action within the wedge shows lower highs and lower lows, but the range narrows, showing a loss of selling momentum.
This pattern is often considered a precursor to bullish breakouts, particularly when it occurs after a corrective move in an uptrend.
✅ Bullish Breakout Confirmation
A breakout has occurred from the wedge to the upside.
The breakout is supported by a series of higher lows, adding weight to the bullish bias.
A small pullback to retest the breakout area provides an ideal entry point for long positions.
🧩 Key Technical Levels:
🔵 Support:
$3,276.95 has held as a strong horizontal support level, where price rebounded twice, forming a short-term bottom.
This level acts as the stop-loss anchor in the current setup.
🔴 Resistance:
First resistance at $3,346.87, which also serves as the first take-profit level (TP1). It coincides with a previous swing high.
Second resistance/target at $3,373.44, representing a more ambitious target aligning with a key supply zone.
📊 Trade Plan Overview:
Trade Direction: Long (Buy)
Entry Trigger: Breakout above falling wedge + retest confirmation
Stop Loss (SL): Below the support zone, around $3,276.95, to manage downside risk
Take Profit (TP1): $3,346.87 – the base of the recent resistance zone
Take Profit (TP2): $3,373.44 – full pattern target and previous structure high
🔄 Expected Price Movement:
Price breaks out of the wedge.
Pullback toward wedge resistance (now support).
Bullish continuation to TP1.
Potential consolidation or minor pullback.
Final push to TP2 if bullish momentum sustains.
📌 Risk Management Notes:
This setup offers a favorable risk-to-reward ratio, with a relatively tight SL and clear upside targets.
If price closes back inside the wedge, or breaks below support, the trade setup would be invalidated.
Volatility should be monitored around key U.S. economic data releases, especially given the proximity of the setup to market-moving events (as indicated on the chart).
📈 Technical Summary:
Element Value / Area
Pattern Type Falling Wedge (Bullish)
Timeframe 1 Hour (H1)
Entry Zone Post-breakout Retest
Stop Loss $3,276.95
Take Profit 1 $3,346.87
Take Profit 2 $3,373.44
Trend Bias Bullish
📣 Conclusion:
The XAU/USD 1H chart displays a classic bullish reversal structure with a falling wedge breakout. The setup is aligned with price action logic, key horizontal levels, and momentum shift cues. As long as the price remains above the support at $3,276.95, the outlook favors further upside movement, targeting $3,346 and $3,373 respectively.
This trade idea provides a clean, structured opportunity with defined entry, target, and risk levels — suitable for both intraday and short-term swing traders.
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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.
Related publications
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.