XAU/USD 4H Chart – Bearish Reversal Setup at Key Resistance Zone
(XAU/USD), showing price action, moving averages, and a potential trade setup. Here's the analysis based on the chart:
Key Observations:
Highlighted Resistance/Support Zone (Mislabelled as “SUPPOT”):
The light blue box at the top marks a key resistance zone around 3,358 to 3,405.
This level previously acted as support and is now potentially turning into resistance (support-turned-resistance scenario).
Moving Averages:
Red line: 50-period EMA – currently above the 200 EMA, indicating short-term bullish momentum.
Blue line: 200-period EMA – showing a longer-term trend.
Price is above both EMAs, typically a bullish sign, but it's nearing a resistance zone.
Trade Setup:
A short position seems to be planned, based on rejection from the resistance zone.
Entry: Around the current price (~3,358).
Stop-Loss: Near 3,405.
Take-Profit (TP): At the "POINT" level, near 3,136.75.
Risk-Reward Ratio:
Visually, the RR ratio looks favorable—approximately 1:3, meaning for every 1 unit risked, the reward is 3 units.
Interpretation:
The trader anticipates resistance holding and a downward reversal.
This setup favors shorting near the resistance zone, targeting a return to the recent swing low.
Confirmation of rejection (e.g., bearish candlestick patterns like shooting star or engulfing) would strengthen the case for entering short.
Caution/Recommendations:
Watch for volume or confirmation candles before entering.
Be cautious of false breakouts, especially in volatile assets like gold.
Keep an eye on macroeconomic events (e.g., USD data releases, Fed news) which heavily influence gold prices
Key Observations:
Highlighted Resistance/Support Zone (Mislabelled as “SUPPOT”):
The light blue box at the top marks a key resistance zone around 3,358 to 3,405.
This level previously acted as support and is now potentially turning into resistance (support-turned-resistance scenario).
Moving Averages:
Red line: 50-period EMA – currently above the 200 EMA, indicating short-term bullish momentum.
Blue line: 200-period EMA – showing a longer-term trend.
Price is above both EMAs, typically a bullish sign, but it's nearing a resistance zone.
Trade Setup:
A short position seems to be planned, based on rejection from the resistance zone.
Entry: Around the current price (~3,358).
Stop-Loss: Near 3,405.
Take-Profit (TP): At the "POINT" level, near 3,136.75.
Risk-Reward Ratio:
Visually, the RR ratio looks favorable—approximately 1:3, meaning for every 1 unit risked, the reward is 3 units.
Interpretation:
The trader anticipates resistance holding and a downward reversal.
This setup favors shorting near the resistance zone, targeting a return to the recent swing low.
Confirmation of rejection (e.g., bearish candlestick patterns like shooting star or engulfing) would strengthen the case for entering short.
Caution/Recommendations:
Watch for volume or confirmation candles before entering.
Be cautious of false breakouts, especially in volatile assets like gold.
Keep an eye on macroeconomic events (e.g., USD data releases, Fed news) which heavily influence gold prices
Trade active
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Join My Official Channel Link
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Join My Public Channel Link
t.me/goldprotreader
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Join My Public Channel Link
t.me/goldprotreader
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.