Last Monday, a strong sell-off pushed gold prices down by nearly $250, and the decline was ultimately halted at the key 4,270 level.
The 4,271–4,292 zone holds strong weekly significance and has the potential to act as a launchpad for setting new all-time highs. In addition, a medium-term ascending trendline is located near this area, which significantly increases the probability of liquidity collection below 4,270 to tap into this trendline.
If this scenario plays out, we could witness a strong rejection and a meaningful bullish expansion from this zone, with the setup potentially forming around the 4,250 level.
The 4,405 resistance will play a crucial role in confirming the bullish trend. A clean break above this level, followed by a healthy pullback, would present buy opportunities.
Alternatively, if bearish momentum resumes, downside targets are seen at 4,170 and subsequently 4,000. However, such a decline would require major fundamental catalysts, which, given the current tense geopolitical environment, we consider less likely at this stage.
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