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Hi everyone, this is my opinion on the current XAUUSD setup.
market analysis
Gold has shown a constructive structure in the short term, with gold prices gradually recovering after holding on to the support of the upward trend line. On the chart, the market is now constricting between the falling resistance line and the rising support line, forming a tight structure that usually results in a trend breakout.
What makes this setup even more interesting is that the price continues to follow an ascending trendline from below, which means buyers are still defending the short-term structure. As long as this line remains intact, a bullish case remains preferable.
Currently, XAUUSD is approaching the upper limit of this narrow area around 4533. These are the first levels that obviously need to be taken back. If the price breaks above the descending resistance line and confirms the breakout with a fixed candle, gold prices may open a channel to the liquidity zone to buy at 4603.
Above this, the next major upside target is located near 4694, which is marked as a strong liquidity area on the chart and is also the main upside target for this setup. In other words, the current structure suggests that if trendline support holds and resistance gives way, gold prices may continue to rise into the next area of liquidity.
On the downside, the uptrend line remains the main technical guidance. If the price loses this support, the upside continuity will weaken and the market may make a deeper correction towards 4405 or even 4354.
Important price areas to monitor
Current price range: around 4533
Trendline support: Still in place
Breakthrough confirmation zone: above the falling resistance line
First upside target: 4603
Main upside target: 4694
If the trend line fails, support below: 4405
Deeper Bearish Confirmation: 4354
Scenarios and Strategies
My preferred scenario is to remain bullish as long as price continues to follow the uptrend line. Confirmation of a break above the bearish resistance would expand the recovery structure and open the way to 4603 first, followed by 4694 if momentum continues to build.
The most important thing here is confirmation. Not only will I be watching for price to hit resistance, I will also be watching for gold to break out and hold above the trendline pressure area with a clear bullish reaction. This would be a signal that buyers are ready to push the market higher.
However, if the price fails to hold the uptrend line and slides back below, the bullish pattern will lose strength and a further pullback to 4405 or 4354 is likely before the market attempts another bounce.
This is the setup I see so far. Thank you for reading and always manage your risks carefully.
