XAU/USD 4H Timeframe AnalysisXAU/USD 4H Timeframe Analysis
Trend Analysis:
On the 4-hour (4H) chart, XAU/USD (Gold) is currently in a consolidation phase, where the price is ranging within a defined level. We have identified three minor key levels during this consolidation period that are acting as crucial points for both buyers and sellers.
Minor Support Key: At 2.630, the price has shown a tendency to find support from buyers who pushed the price upward, leading to a retest of the next minor resistance level at 2.660.
Minor Resistance Key: At 2.660, the price has faced resistance and pulled back, suggesting indecision in the market.
We expect that after testing the resistance, the price will likely break below the support key to potentially hunt for liquidity, particularly stop-loss orders placed by buyers.
Price Action Expectation:
Given the recent price action, we anticipate that the price will move back to the minor support key at 2.630 before a potential breakdown below it. Once this occurs, we expect the price to continue lower, breaking through the support level and targeting liquidity zones where stop-loss orders from buyers may be positioned.
In a bullish scenario, if the price manages to break the minor resistance at 2.660, the market could continue its upward movement.
Trade Setup:
Trade Type: Sell Stop (Breakout)
Entry Price: 2.617.30 (below the minor support key at 2.630 after a confirmed breakdown)
Stop Loss: 2.654.10 (within the liquidity zone above the minor resistance at 2.660)
Take Profit: 2.590.00 (potential target at the next support level)
Fundamental Correlation:
Gold prices are influenced by a variety of factors, including inflation data, geopolitical tensions, and monetary policy decisions from the Federal Reserve. In the near term, market sentiment may drive price movements. If there are any economic data releases or shifts in risk sentiment, they could play a role in either supporting or weakening gold prices.
Conclusion:
XAU/USD is currently consolidating, and the price movement between 2.630 (minor support) and 2.660 (minor resistance) suggests that traders should monitor for a breakdown below 2.630 for a potential sell setup. A confirmation of a break below this level will provide an opportunity to enter short, with a target at the next support.
Risk Management:
As always, ensure proper position sizing and maintain a favorable risk-to-reward ratio of 1:2 or higher. Adjust your trades according to real-time market conditions and economic events that may affect the price of gold.
