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How to Identify Significant Liquidity Zone in Gold Trading A liquidity zone is a specific area on a price chart where the market orders concentrate. In this article, I will teach you how to identify the most significant liquidity zones on Gold chart beyond historical levels. Liquidity Zones First, in brief, let's discuss where liquidity concentrates. Market liquidity concentrates on: 1. Psychological levels Above, you can see a clear concentration of liquidity around a 2500 psychological level on Gold price chart. 2. Fibonacci levels In the example above, we can see how 382 retracement of a major bullish impulse attracts market liquidity on Gold XAUUSD daily time frame. 3. Horizontal support and resistance levels and trend lines. In that case, an area based on a classic support/resistance level was a clear source of market liquidity on Gold. Significant Liquidity Zone A significant liquidity zone will be the area where psychological levels, Fibonacci levels, horizontal support and resistance levels and trend lines match . Please, note that such an area may combine the indicators, or any other technical tools. Such zones can be easily found even beyond the historic levels. Look at a price chart on Gold on a daily. Though the market has just updated the ATH, we can spot the next potentially significant liquidity zone with technical analysis. We see a perfect intersection of a rising trend line, 2600 psychological level based on round numbers and a Fibonacci extension confluence of 2 recent bullish impulses. These technical tools will compose a significant liquidity zone. The idea is that Gold was rallying up because of the excess of demand on the market. We will assume that selling orders will be placed within that liquidity zone and the excess of demand will be absorbed by the supply. It will make the price AT LEAST stop growing and potentially will trigger a correctional movement. Learn to recognize such liquidity zones, it will help you a lot in predicting Gold price movements. ❤️Please, support my work with like, thank you!❤️
OANDA:XAUUSDEducation
by VasilyTrader
4
GOLD (XAUUSD): Deep Consolidation & Your Trading Plan Gold is trading in sideways range for more than 2 trading weeks already. The recent high impact fundamental releases, did not manage to violate its weakness. Next week, pay attention to the reaction of the price to the support and resistance of the underlined range. If the price breaks and closes below 2605, it will open a potential for a further bearish continuation to 2565. Bullish breakout of the resistance of the range and a daily candle close above 2666 will confirm the strength of the buyers. The up movement will be expected at least to 2715. The absence of strong fundamental triggers will continue the consolidation. Alternatively, you can trade the market within the range, buying from its support and selling from its resistance. ❤️Please, support my work with like, thank you!❤️
OANDA:XAUUSDShort
by VasilyTrader
1
Gold Becomes the Second Largest Central Bank Reserve AssetGold's importance as a reserve asset for central banks is on the rise According to Bank of America, gold has now overtaken the euro to become the second largest reserve asset, To be more precise, B of A should have specified that it is the eastern hemisphere Central Banks that are diversifying out of the U.S. dollar and the euro and buying gold and yuan. Currently, gold accounts for 16% of global bank reserves, while the dollar has dropped to about 58%, down from over 70% in 2002. Poland emerged as the largest buyer of gold in the second quarter of this year (though the specific amount purchased by China's PBoC remains undisclosed). Additionally, Poland is requiring that the gold it acquires be delivered directly to its Central Bank, rather than being stored by London banks. Turkey is another significant gold purchaser, and several African nations have also announced plans to increase Central Bank gold reserves. While it may not happen immediately, there’s potential for gold to surpass the dollar as the top reserve asset, especially if the BRIC nations and other Eastern hemisphere countries go forward with their rumored plans for a gold-backed trade currency. A BRICS Summit will be held in Kazan, Russia, from October 22nd to 24th, where discussions on a new trading currency may take place, though this has not been officially confirmed. On September 5th, Russia announced plans to ramp up its daily gold purchases from $13.5 million to $93 million (1.2 billion rubles to 8.2 billion rubles) for the next month, using surplus revenue from oil and gas. This information was reported by the Russian news agency, Interfax. This move seems to align with the potential development of a BRICS gold-backed trade settlement currency, or even a broader gold-backed currency system. I raise this point because the U.S. Federal Reserve is in a difficult position. It’s facing immense pressure from the market and Wall Street to reduce interest rates, but doing so could trigger a sharp decline in the value of the dollar. The chart referenced above shows a 5-year daily performance of the US dollar index, with the dollar currently testing the 100 level—a key technical support since early 2023. If the Federal Reserve begins cutting interest rates, it's highly likely the dollar will fall to 90, a level last seen in mid-2021. This decline would likely push gold prices toward $3,000 and silver toward $50. A weakening dollar presents several challenges. First, it could accelerate the reduction in the dollar's role as a reserve asset for global central banks. Even more concerning for the US, a depreciating dollar coupled with lower interest rates would make it harder to attract foreign investment to finance additional Treasury debt, a challenge that is already becoming evident. Additionally, the Fed is aware that inflation is running higher than what is reported by the CPI. Reducing rates will further drive real interest rates deeper into negative territory. While the official CPI suggests real rates are positive, using more comprehensive measures like the Shadow Stats Alternative CPI, real rates are currently at -3% using the 1990 CPI method and -6% based on the 1980 version. Negative real interest rates fuel price inflation, contributing to its persistence. Cutting rates further would likely intensify this inflationary pressure. This is one reason gold has been reaching new all time highs almost daily since the Fed cut rates earlier this month. Silver, similarly, is on the verge of breaking into the high $33 range. Precious metals markets are anticipating more than just optimistic Fed rhetoric about a strong economy and lower inflation; they are also predicting a potential return to money printing policies
OANDA:XAUUSDLong
by moonypto
99% rate cut odds in election week? With both the election and an upcoming Fed meeting in focus, markets could face a surge in volatility this week. According to the CME Group’s FedWatch Tool, traders are placing a 99% probability on a quarter-point rate cut at the conclusion of the Fed’s policy meeting on Thursday, following a half-point cut in September. After the rate decision, Fed Chair Jerome Powell is expected to speak. But, even if Thursday brings a clear election outcome, Fed officials are likely to sidestep any questions about potential policies from the next administration until the winner assumes office. Only then will they assess how campaign pledges translate into actual policy, watching closely to see how businesses, consumers, and financial markets react before making any further moves on monetary policy.
BLACKBULL:XAUUSD
by BlackBull_Markets