Gold has pulled back from its record highs in last December but seems to be setting its sights higher once more.
Will this former resistance zone keep holding as support?
Check out the potential targets on the 4-hour time frame!
Gold (XAU/USD) 4-hour Chart by TradingView
Gold prices have formed higher lows connected by an ascending trend line since November last year, and it looks like this area is once again holding as support.
After all, geopolitical tensions have spiked over the weekend after the U.S. announced that Venezuelan President Maduro is in its custody, prompting global outrage.
Can gold set fresh record highs from here?
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on the U.S. dollar and gold, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
XAU/USD has bounced off the area of interest around the 50% Fibonacci retracement level and trend line, possibly aiming for the next bullish targets at R1 ($4,495.60) then the swing high.
Stronger bullish momentum could take it even higher to R2 ($4,659.13) then R3 ($4,769.92) if safe-haven flows keep surging.
On the other hand, a return in dollar demand could prompt another test of the resistance-turned-support region or a break lower to S1 ($4,221.27) then S2 ($4,110.48) while markets also turn their focus to top-tier U.S. releases later in the week.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment.
Disclaimer:
Please be aware that the technical analysis content provided herein is for informational and educational purposes only. It should not be construed as trading advice or a suggestion of any specific directional bias. Technical analysis is just one aspect of a comprehensive trading strategy. The technical setups discussed are intended to highlight potential areas of interest that other traders may be observing. Ultimately, all trading decisions, risk management strategies, and their resulting outcomes are the sole responsibility of each individual trader. Please trade responsibly.
