Golden Week Review: The battle between buyers and sellers in 4870, the turning point is coming next week! Credibility of Middle East ceasefire remains unclear; watch for openings

This week, the gold market saw a strong “V”-shaped recovery, followed by consolidation at high levels. At the beginning of the week, gold prices initially fell to $4,640 before rising to $4,890 as buyers showed significant resilience. However, buyers failed to break through the strong resistance level all at once, with the price fluctuating between $4,750 and $4,870 for most of the week, before finally closing at $4,833, a weekly gain of 0.77%. This narrow zone of “no rise or fall” is usually what precedes a storm.

Key fundamental factors: The situation in the Middle East has become the biggest variable; ceasefire negotiations affect market sentiment

The weekend’s news brought unexpected developments that directly impact next week’s opening. Israel and Lebanon reached a ten-day temporary ceasefire agreement, while the United States and Iran planned to resume negotiations on Pakistan, initially easing market risk aversion. However, as someone who has been engaged in geopolitical transactions for a long time, I have to remind everyone that the “negotiating table” in the Middle East is always an extension of the battlefield. If negotiations break down or local conflicts resume, safe-haven funds will flow into gold, which could lead to a strong opening next week and a continuation of the upward trend. On the other hand, if the situation improves significantly, gold prices will face downward pressure.

Hot events to watch next week:

First reading of U.S. manufacturing PMI in April (strong data may cause the dollar to rebound and put pressure on gold prices).

A letter to various Fed officials (markets will be looking for signs on the timing of rate cuts).

The implementation of the ceasefire agreement in the Middle East (which may lead to a spread in gold prices at any time).

Traders should be prepared for price gap risk. Stop-loss orders should be set for weekend positions to avoid chasing the highest and lowest prices at Monday’s opening.

Technical analysis: The long-term upward trend still exists; short-term consolidation awaits a breakthrough.

Daily chart: The ascending channel remains in place, with the 5-, 10-, and 20-day moving averages in record bullish positions, indicating that the mid-term uptrend continues. However, please note that the $4870-4890 area is a strong resistance level. Multiple attempts to break above this level this week have resulted in pullbacks, suggesting weak upside momentum. A strong break above $4890 on higher volume would extend the upside range to $4910-5000. If this breakout is rejected and prices decline, the 20-day moving average (around $4,650) will remain the main support level in the medium term.

Four-hour chart: The Bollinger Bands gradually narrow, and the price fluctuates near the middle band. The MACD range is contracting and the Relative Strength Index (RSI) is oscillating within neutral to bearish territory – a classic consolidation pattern. Pay close attention to the breakthrough trend of the upper Bollinger Band (4865-4870) and the lower Bollinger Band (4765-4750): a breakthrough of the upper Bollinger Band with larger trading volume will restart the upward trend; a breakthrough of the lower Bollinger Band will indicate the beginning of an adjustment.

Hourly Chart – Moving averages cross downwards and consecutive bearish candles form a “bullish engulfing” pattern, indicating a short-term bearish bias. However, as the overall trend remains bullish, this pullback is a good opportunity to enter the long position. Strong resistance next week remains at $4870-4890; a break above this level will target $4900-4950. The first level of support is located at $4,800; a move below this level could test the strong support at $4,750.

Trading strategy for next week (personal opinion: buy on dips)

Daily and Early Week Trading Strategies:

Long position (my first choice): I recommend buying on a pullback to $4805-4810 with a stop loss of $4795 and a price target of $4860-4880.

Sell ​​position (only for simulated positions at key resistance levels): It is recommended to open a small sell position on the first price hit between $4890 and $4895, with a stop loss set at $4905 and a target price between $4830 and $4810.

My personal vision: At this level, I’m not worried about decline, but I’d rather not see any decline. The longer the oscillation period, the greater the possibility of a breakthrough. Since the overall uptrend remains intact, I think a pullback into the support area would be a good opportunity for a stop-loss order.

Next week could be a turning point; is your position still safe?

I know this week’s extreme volatility has been painful for many – short positions were held until a break above $4840, while long positions remained stuck around $4880. In this case, it’s best to look for proactive solutions.

If you currently have:

Sell ​​position below 4640

Buy above 4880

Don’t worry and don’t be stubborn about sticking to your guns. The situation in the Middle East will directly determine the direction of the market gap when the market opens next Monday. Professional solutions require a customized approach based on your position size, purchase price and risk tolerance. Leave a message to inform you of your position details (entry point + contract size), and I will provide you with a comprehensive solution analysis before the market opens, as well as specific adjustments to your investment portfolio in the coming week.

The market is full of opportunities, but it lacks someone who can calmly analyze the risks with you. Let’s face the turning point next week.

Source link