Full Technical Analysis of XAU/USD (Gold Spot) – 1H Chart
📌 Overview
This chart illustrates a textbook Falling Wedge Reversal Pattern, identified after a strong bearish correction from the resistance zone. The price has now broken out of this wedge, suggesting a potential bullish continuation in the short term. The setup includes clear support/resistance zones, entry/exit levels, and a favorable risk-reward ratio.
🟩 Pattern Identified: Falling Wedge
A Falling Wedge is a bullish reversal pattern characterized by two downward-sloping converging trendlines.
The wedge began forming after price was rejected from the resistance zone around $3,470–$3,500.
Multiple touchpoints confirm the wedge structure:
Each swing high is lower than the previous (forming the upper resistance trendline).
Each swing low is also lower but with diminishing strength (forming the lower support trendline).
The wedge concludes with a bullish breakout, which is supported by strong price action and a momentum shift.
🧱 Key Technical Zones
🔹 Resistance Zone: $3,470–$3,500
This level served as a strong supply zone.
Price rejected this level twice, forming the beginning of the wedge.
Now a potential long-term upside target if momentum continues.
🔹 Support Zone: $3,275–$3,290
Established by previous demand and the base of the wedge.
It’s also the point of the last significant bullish reversal.
Acts as the logical stop-loss area for long trades.
🔹 Breakout Confirmation
The breakout occurred just above $3,330–$3,335, completing the wedge structure.
Breakout confirmed by bullish momentum and a higher high after the final lower low.
Entry confirmation at the breakout retest area, marked near $3,340–$3,345.
🎯 Trade Plan Breakdown
Element Level Comment
Entry (TP area) $3,363.481 Ideal breakout retest and early target
Final Target $3,400.087 Horizontal resistance + measured wedge projection
Stop Loss (SL) $3,275.905 Below wedge base, invalidates bullish thesis if broken
Reward:Risk Ratio ~2:1 Favorable setup, strong pattern support
📈 Projected Price Path
Price is expected to retest the breakout level ($3,363) before continuing upward.
A smooth bullish wave could target $3,400, coinciding with prior resistance and Fibonacci zones.
Failure to hold above $3,300 could reintroduce bearish pressure, invalidating the wedge.
⚙️ Technical Summary
Pattern: Falling Wedge (Bullish Reversal)
Structure Shift: Bearish to Bullish
Market Sentiment: Reversal from oversold zone
Volatility: Moderate, range-bound inside wedge, breakout expanding
💬 Professional Insight
“Gold (XAU/USD) has completed a falling wedge breakout from a key support zone, signaling a bullish reversal. The setup offers a clean entry with tight stop placement and an attractive upside toward $3,400. Watch for confirmation candles or volume spikes near the breakout retest area to confirm bullish continuation. A breach below $3,275 would invalidate the pattern.”
📌 Overview
This chart illustrates a textbook Falling Wedge Reversal Pattern, identified after a strong bearish correction from the resistance zone. The price has now broken out of this wedge, suggesting a potential bullish continuation in the short term. The setup includes clear support/resistance zones, entry/exit levels, and a favorable risk-reward ratio.
🟩 Pattern Identified: Falling Wedge
A Falling Wedge is a bullish reversal pattern characterized by two downward-sloping converging trendlines.
The wedge began forming after price was rejected from the resistance zone around $3,470–$3,500.
Multiple touchpoints confirm the wedge structure:
Each swing high is lower than the previous (forming the upper resistance trendline).
Each swing low is also lower but with diminishing strength (forming the lower support trendline).
The wedge concludes with a bullish breakout, which is supported by strong price action and a momentum shift.
🧱 Key Technical Zones
🔹 Resistance Zone: $3,470–$3,500
This level served as a strong supply zone.
Price rejected this level twice, forming the beginning of the wedge.
Now a potential long-term upside target if momentum continues.
🔹 Support Zone: $3,275–$3,290
Established by previous demand and the base of the wedge.
It’s also the point of the last significant bullish reversal.
Acts as the logical stop-loss area for long trades.
🔹 Breakout Confirmation
The breakout occurred just above $3,330–$3,335, completing the wedge structure.
Breakout confirmed by bullish momentum and a higher high after the final lower low.
Entry confirmation at the breakout retest area, marked near $3,340–$3,345.
🎯 Trade Plan Breakdown
Element Level Comment
Entry (TP area) $3,363.481 Ideal breakout retest and early target
Final Target $3,400.087 Horizontal resistance + measured wedge projection
Stop Loss (SL) $3,275.905 Below wedge base, invalidates bullish thesis if broken
Reward:Risk Ratio ~2:1 Favorable setup, strong pattern support
📈 Projected Price Path
Price is expected to retest the breakout level ($3,363) before continuing upward.
A smooth bullish wave could target $3,400, coinciding with prior resistance and Fibonacci zones.
Failure to hold above $3,300 could reintroduce bearish pressure, invalidating the wedge.
⚙️ Technical Summary
Pattern: Falling Wedge (Bullish Reversal)
Structure Shift: Bearish to Bullish
Market Sentiment: Reversal from oversold zone
Volatility: Moderate, range-bound inside wedge, breakout expanding
💬 Professional Insight
“Gold (XAU/USD) has completed a falling wedge breakout from a key support zone, signaling a bullish reversal. The setup offers a clean entry with tight stop placement and an attractive upside toward $3,400. Watch for confirmation candles or volume spikes near the breakout retest area to confirm bullish continuation. A breach below $3,275 would invalidate the pattern.”
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.
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.