Remember that head and shoulders pattern we were watching on gold?
Well, the precious metal already broke below the neckline and looks ready for a quick retest.
Can this be an opportunity to catch a longer-term selloff?
Gold (XAU/USD) 4-hour – Chart Faster with TradingView
After riding high on geopolitical uncertainty, gold tumbled sharply below its longer-term rising trend line as dollar domination became the next new market theme.
The latest FOMC statement, which featured a hawkish pivot from main man Powell himself, brought safe-haven flows back to the U.S. currency since policymakers highlighted economic resilience and upside inflation risks.
Can XAU/USD still pull off a retracement before heading further south?
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!
Gold found support around the $4,600 mark and appears to be setting its sights on the Fibonacci levels to attract more sellers.
The 38.2% level is near the $4,800 major psychological handle while the 50% Fib is right in line with S2 ($4,860). A much larger correction could still reach the confluence near the 61.8% Fib, $5,000 major psychological level, and the broken neckline support.
Should any of these be enough to keep gold rallies in check, the precious could resume its slide back to support levels near the swing low at S4 ($4,562.54) or lower.
On the other hand, a convincing break back above the key $5,000 barrier could point to more persistent bullish momentum, especially if backed by worsening geopolitical tensions.
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.
Promoted: The Analysis & Strategy are only half the Battle; Your Mindset is the Rest.
Today’s chart art focuses on a potential long-term gold reversal. But as any pro will tell you, even the cleanest trend-following setup can fall apart if the trader doesn’t stay disciplined when price starts testing the level.
In “Unknown Market Wizards,” Jack Schwager interviews successful traders to reveal a common truth: their edge isn’t just knowledge or skills—it’s their psychological resilience and rigid risk control. Whether you’re navigating tariff shocks or safe haven flows into the franc, learn how the “wizards” stay clinical when the rest of the market is emotional.
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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.
