XAUUSD – A clear head and shoulders formation continues to favor buying

🌤 1. Overview – Today’s Photos
Hello everyone, I’m Lana 💬
During the Asian session this morning, gold completed the right shoulder of a clear inverse head and shoulders pattern on the H3/H4 framework. Those who bought as before are now in a comfortable position, and in my opinion this is still a good time to hold buy orders and prepare for additional entry opportunities if the market confirms the trend.

On the macro front, according to the FedWatch CME tool, the probability of a 25 basis point interest rate cut in December has dropped to around 30-33%, while the probability of keeping interest rates unchanged still dominates. This prevents the dollar from falling significantly, but not enough to “squeeze” gold – creating a strong range-bound environment that is ideal for trading based on technical patterns.

💹 2. Technical Analysis – Head and Shoulders Pattern and Price Structure
An inverse head and shoulders pattern may form perfectly:
The left shoulder → head → right shoulder are all based on the long-term uptrend line.

The bottom area around 4040-4050 is the liquidity supporting the entire structure.

The neckline is currently around the 4089-4090 area:
When price breaks out and closes the candle above 4089, we consider it confirmation of a new uptrend.
After the breakthrough, the gold price can expand to the 4145 → 4200 area, with strong liquidity + FVG concentrated above.

Area 4130-4132:
This is a huge liquidity cluster – it’s easy to place take-profit and short-term sell orders.
Once this area is decisively broken, there is a high probability that the price will quickly rebound to 4200.

Area 4040:
It is also the bottom of the pattern and key support.
This scenario will fail if gold prices close the H4 candle below 4040 as this will break the head and shoulders structure.
Generally speaking, with price trading directly below the neckline, all that is needed is a good breakout to activate the next bullish wave.

🎯 3. Refer to the trading plan
💖 Main purchasing scenarios – based on model

1️⃣ Buy on rebound to support
Entry point: 4060-4063
Stop loss: 4055
Profit target: 4088→4108→4130→4143→4200

2️⃣ Buy when the neckline breaks
Condition: Price breaks the downtrend line and neckline and closes above 4089.
Entry point: around 4089-4092
Stop loss: 4080
Reference profit target: 4132→4145→4200

💢 Sales precautions
For now, the sell-off is just a contrarian pattern, not a preferred scenario.

Consider short selling only if:
The price reacted strongly at 4132-4145,
Clear reversal signals appear on M15-M30 (needle candles, bearish engulfing, increasing selling volume).

⚠️4.Basic factors that should be paid attention to
The probability that interest rates will remain unchanged is still high → the market may “freeze” before the news comes out and then fluctuate wildly.
At this point, gold is typically sensitive to data: employment, inflation, statements from Fed officials.

🌷 In summary, the inverse head and shoulders pattern on XAUUSD supports a bullish scenario as long as the price remains above 4040 💛
My strategy:
Prioritize buying, first in the 4060-4063 area, and then break through 4089,
Keep an eye on the 4132-4145 area – if broken, chances of reaching 4200 are very clear.
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