XAUUSD: Stall Alert; Sell of the Year
Historically, overall price action has been in a strong uptrend, reaching its peak in Aug 2020. Since then, price has dropped and retested our monthly supply zone on two different occasions. The wick rejection near this level and the inability for price to move beyond this point implies to me that overall price is stalling and a trend reversal may be near.
For Wyckoffians, this is an area where price appears to be undergoing a major distribution and orderflow is changing hands from buyers to sellers.
I want to keep this really simple so taking it down to the 30min timeframe, here's my analysis:
Point A
On minor structure, price is currently in the midst of a push downward. Price broke the minor structure trendline, broke the previous higher low and then pushed back up to retest the minor structure trendline, creating a new lower high. This lower high has now become our minor structure high for relevant price action [i.e., this is the point where the actual trend reversal occurred on minor structure].
Point B
At that point, price dropped to break the 4H Trendline before creating a new higher low and coming back to retest the trendline. Because the 4H structure represented the daily retracement, we can now consider that retracement to be over and the new downtrend will continue.
We've now had two trendline break and retests along with the break of structure to the downside. This indicates that price is now, in fact, in a downtrend.
Point C
However, bullish divergence has emerged along with an EMA crossover, signaling bullish pressure. Because of this, I need to watch this area to make sure that price doesn't continue to retrace higher above the 4H trend continuation trendline before dropping.
As indicated by my bars pattern, even if price pullbacks slightly further, ultimately price will drop in the short term and the overall downtrend will emerge. I have two price targets for the sell based on the 4H and 30 min fibs for this structure.
TP1 - 1918.064 (4H TP2)
TP2 - 1908.385 (30min TP2).
For Wyckoffians, this is an area where price appears to be undergoing a major distribution and orderflow is changing hands from buyers to sellers.
I want to keep this really simple so taking it down to the 30min timeframe, here's my analysis:
Point A
On minor structure, price is currently in the midst of a push downward. Price broke the minor structure trendline, broke the previous higher low and then pushed back up to retest the minor structure trendline, creating a new lower high. This lower high has now become our minor structure high for relevant price action [i.e., this is the point where the actual trend reversal occurred on minor structure].
Point B
At that point, price dropped to break the 4H Trendline before creating a new higher low and coming back to retest the trendline. Because the 4H structure represented the daily retracement, we can now consider that retracement to be over and the new downtrend will continue.
We've now had two trendline break and retests along with the break of structure to the downside. This indicates that price is now, in fact, in a downtrend.
Point C
However, bullish divergence has emerged along with an EMA crossover, signaling bullish pressure. Because of this, I need to watch this area to make sure that price doesn't continue to retrace higher above the 4H trend continuation trendline before dropping.
As indicated by my bars pattern, even if price pullbacks slightly further, ultimately price will drop in the short term and the overall downtrend will emerge. I have two price targets for the sell based on the 4H and 30 min fibs for this structure.
TP1 - 1918.064 (4H TP2)
TP2 - 1908.385 (30min TP2).
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