XAUUSD 4H Key Considerations for the 2024 U.S. Election
High-Level Observations and Zones
Dealing Range (12M-3M) and PMH:
This range, marked at the top, represents a high timeframe dealing range and a recent swing high (PMH). The upper boundary, around 2,790, coincides with the inducement wave, suggesting that a strong resistance or potential reversal point could be located near this level if the price reaches it.
Inducement and Buy Side BSL:
Similar to the previous chart, this inducement level suggests a point where liquidity can be captured, potentially triggering a short-term reversal as retail traders get trapped. The Buy Side BSL (Buy Stop Liquidity) above this range marks where buy-side liquidity rests, which could fuel further upside if price breaks through convincingly.
Low Resistance Liquidity Run (LRLR):
This zone, around 2,745.95, indicates a low-resistance liquidity area where price may move smoothly, suggesting that any breach here could lead to a rapid price movement until encountering the next major liquidity pool.
Psychological Level (PSY):
This area likely serves as a psychological threshold where traders' sentiment may shift, offering potential support or resistance. Here, it’s positioned near the lower boundary of the recent range.
Point of Control (POC) and Volume Profile Analysis:
The POC at 2,731.95 represents the price level with the most traded volume in this range, acting as a significant support or resistance. The volume profile shows a high concentration of trading activity around this level, suggesting it’s a key point for institutional interest.
Market Structure and Wave Counts
Corrective Structure (Elliott Wave):
The chart illustrates an ongoing corrective structure with multiple subwaves labeled (w), (x), (y), etc., suggesting a potential W-X-Y correction. The recent downward movement aligns with this corrective wave, pointing to an extended consolidation phase within a larger bullish setup.
Projection of the Motive Phase:
After the corrective wave completes, the projected structure on the right shows a potential 5-wave upward sequence (i, ii, iii, iv, v). This projected path, indicated by the labeled wave counts, implies that once the corrective wave completes, a motive phase might drive the price upwards to new highs within the current dealing range.
Motive Phase Label:
The lower right part of the chart points to a "Motive Phase" which suggests that if the corrective structure plays out and holds above the invalidation point, a bullish impulse might start. This phase typically indicates stronger, trend-aligned moves as opposed to corrective, choppy price action.
Key Levels and Fibonacci Zones
Discount and Premium Zones:
The equilibrium (0.5 Fib) is marked at 2,733.89, a midpoint for potential reversion within this corrective structure. The chart labels a “Discount” zone above this equilibrium level, suggesting a favorable buying opportunity for bulls as long as price remains above key support.
0.382 Fibonacci Level (2,731.95):
This level acts as a significant retracement target within the corrective wave structure. Positioned close to the POC, it reinforces this level as a critical area for potential buy-side interest if price revisits it.
Premium and Invalidation Levels:
The premium area is below the 0 level (2,724.70), which aligns with the invalidation point. A drop below this point would negate the bullish setup and signal potential downside continuation, making it a key reference for managing risk.
Strategic Levels for Trading Decisions
Bullish Entry Zone:
The POC and 0.382 level serve as attractive points for entering long positions, with tight risk management below the invalidation level. These levels, backed by volume and Fibonacci retracement, provide a favorable risk-reward setup.
Upside Targets:
The primary target for bullish continuation is the Buy Side BSL and Dealing Range high at 2,790.08. If this level is broken, further upside toward the psychological level around 2,803.68 (near the top of the chart) could be expected.
Potential Triggers for Reversals:
If price hits the inducement level near 2,790 and shows signs of rejection, a short-term reversal could occur. This would provide an opportunity for traders to either exit long positions or potentially enter shorts with stops above recent highs.
Additional Notes
Volume and Market Sentiment:
The volume bars show higher activity at key reversal points, especially during wave transitions, highlighting areas of potential institutional interest.
Structural Patterns:
The corrective nature of the current price action, combined with the projection for a motive phase, indicates that the market is consolidating within a bullish trend, awaiting a breakout.
In summary, this chart outlines a bullish structure with corrective waves currently in play. Traders may look for long entries around the POC (2,731.95) or upon the breakout of key liquidity zones (2,790.08), targeting the dealing range highs. However, the invalidation level at 2,724.70 must hold to maintain this bullish outlook.
Dealing Range (12M-3M) and PMH:
This range, marked at the top, represents a high timeframe dealing range and a recent swing high (PMH). The upper boundary, around 2,790, coincides with the inducement wave, suggesting that a strong resistance or potential reversal point could be located near this level if the price reaches it.
Inducement and Buy Side BSL:
Similar to the previous chart, this inducement level suggests a point where liquidity can be captured, potentially triggering a short-term reversal as retail traders get trapped. The Buy Side BSL (Buy Stop Liquidity) above this range marks where buy-side liquidity rests, which could fuel further upside if price breaks through convincingly.
Low Resistance Liquidity Run (LRLR):
This zone, around 2,745.95, indicates a low-resistance liquidity area where price may move smoothly, suggesting that any breach here could lead to a rapid price movement until encountering the next major liquidity pool.
Psychological Level (PSY):
This area likely serves as a psychological threshold where traders' sentiment may shift, offering potential support or resistance. Here, it’s positioned near the lower boundary of the recent range.
Point of Control (POC) and Volume Profile Analysis:
The POC at 2,731.95 represents the price level with the most traded volume in this range, acting as a significant support or resistance. The volume profile shows a high concentration of trading activity around this level, suggesting it’s a key point for institutional interest.
Market Structure and Wave Counts
Corrective Structure (Elliott Wave):
The chart illustrates an ongoing corrective structure with multiple subwaves labeled (w), (x), (y), etc., suggesting a potential W-X-Y correction. The recent downward movement aligns with this corrective wave, pointing to an extended consolidation phase within a larger bullish setup.
Projection of the Motive Phase:
After the corrective wave completes, the projected structure on the right shows a potential 5-wave upward sequence (i, ii, iii, iv, v). This projected path, indicated by the labeled wave counts, implies that once the corrective wave completes, a motive phase might drive the price upwards to new highs within the current dealing range.
Motive Phase Label:
The lower right part of the chart points to a "Motive Phase" which suggests that if the corrective structure plays out and holds above the invalidation point, a bullish impulse might start. This phase typically indicates stronger, trend-aligned moves as opposed to corrective, choppy price action.
Key Levels and Fibonacci Zones
Discount and Premium Zones:
The equilibrium (0.5 Fib) is marked at 2,733.89, a midpoint for potential reversion within this corrective structure. The chart labels a “Discount” zone above this equilibrium level, suggesting a favorable buying opportunity for bulls as long as price remains above key support.
0.382 Fibonacci Level (2,731.95):
This level acts as a significant retracement target within the corrective wave structure. Positioned close to the POC, it reinforces this level as a critical area for potential buy-side interest if price revisits it.
Premium and Invalidation Levels:
The premium area is below the 0 level (2,724.70), which aligns with the invalidation point. A drop below this point would negate the bullish setup and signal potential downside continuation, making it a key reference for managing risk.
Strategic Levels for Trading Decisions
Bullish Entry Zone:
The POC and 0.382 level serve as attractive points for entering long positions, with tight risk management below the invalidation level. These levels, backed by volume and Fibonacci retracement, provide a favorable risk-reward setup.
Upside Targets:
The primary target for bullish continuation is the Buy Side BSL and Dealing Range high at 2,790.08. If this level is broken, further upside toward the psychological level around 2,803.68 (near the top of the chart) could be expected.
Potential Triggers for Reversals:
If price hits the inducement level near 2,790 and shows signs of rejection, a short-term reversal could occur. This would provide an opportunity for traders to either exit long positions or potentially enter shorts with stops above recent highs.
Additional Notes
Volume and Market Sentiment:
The volume bars show higher activity at key reversal points, especially during wave transitions, highlighting areas of potential institutional interest.
Structural Patterns:
The corrective nature of the current price action, combined with the projection for a motive phase, indicates that the market is consolidating within a bullish trend, awaiting a breakout.
In summary, this chart outlines a bullish structure with corrective waves currently in play. Traders may look for long entries around the POC (2,731.95) or upon the breakout of key liquidity zones (2,790.08), targeting the dealing range highs. However, the invalidation level at 2,724.70 must hold to maintain this bullish outlook.
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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.