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The direction of the XAUUSD/H1 pair remains unclear as the structure of lower highs and lows and the downtrend on the longer time frame have yet to be broken. Currently, the price is recovering after a sharp correction and is stabilizing within the trend line before determining its next direction.
The exponential moving averages (EMA) across multiple time frames (H4 – H2 – H1) indicate a purely bearish trend, with the 34 EMA below the 89 EMA. There is currently no momentum to support a strong rebound in gold prices, nor is there any good news about the success of the negotiations needed to support a rebound in gold prices.
This area (4640 – 4647) is the major resistance level for the upcoming upward move; if the price breaks this area, the uptrend will continue. As for the area (4605 – 4610), it is considered the main support level. If the price breaks out of this area, a correction towards lower support is likely.
✅Discount
1. Purchase scenario:
– If the price breaks out of the resistance area (4640 – 4647) and closes above it.
– If the price breaks the downtrend line and closes above the 34-hour exponential moving average (H4).
=>The uptrend then continues to the (466x – 467x) level and then to the (471x – 472x) level.
=> The uptrend will rebound strongly when the price breaks out of the resistance area (4718 – 4722) and closes above it.
=> It is worth noting that historically, the area around the entry point (4666 – 4671) has been a strong support area, converging with the downtrend structure on the 1 hour time frame and the downtrend line on the larger time frames. If the price fails to break out of this area, a pullback into the sideways trading range (460x – 464x) is likely.
2. Sales scenario:
– If the price falls and closes below the support levels (4605 – 4610).
– If the price breaks below the uptrend line and closes below the 34 EMA (hourly time frame), the current recovery pattern will be broken, opening the way for a continued decline to the support levels (457 – 458) and beyond (454 – 455).
=> When the price breaks below the support level (4546 – 4553), the downward momentum will strengthen strongly (if not reduced, the price will resume and continue to move sideways).