XAUUSD is currently trading within a well-defined descending channel, with price action consistently forming lower highs and lower lows. This structure reflects sustained bearish momentum, and sellers continue to dominate the overall direction.The recent upward move appears to be a technical rebound, with price approaching a potential resistance zone near the upper boundary of the channel. This area may now serve as a supply zone after acting as previous support, making it an important region for potential rejection.
If the resistance holds, a rejection here could lead to the continuation of the bearish trend, with a potential move targeting the support area around 3,175, aligning with the lower boundary of the descending channel.
However, failure to hold below this level could invalidate the bearish scenario and increase the likelihood of a retest toward the upper boundary of the channel.
Traders should monitor for clear rejection signals at resistance, such as bearish engulfing candles or strong rejection wicks, or alternatively, wait for breakout confirmation before considering a trend shift. As always, proper risk management remains essential.
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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.