Gold has been setting one record high after another lately, but it looks like the precious metal is ready for a major pullback.
Are these support levels still about to hold?
Take a look at these inflection points on the 4-hour time frame!
Gold (XAU/USD) 4-hour Chart by TradingView
Gold bulls have been charging lately thanks to all the market uncertainty surrounding Trump’s tariffs announcements.
However, the precious metal seems to be stalling at its latest all-time high just shy of the $3,000 major psychological mark.
Are we about to see a huge correction from its climb?
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on gold and the U.S. dollar, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
As you can see from the chart above, gold has been forming higher lows connected by an ascending trend line that’s been holding since the start of the year. Another test of this support area could be in the cards, and the Fibonacci retracement tool shows were more buyers may be waiting.
Stay on the lookout for reversal candlesticks around the 50% Fib which lines up with the pivot point level or the 61.8% Fib closer to the trend line support, as a bounce off this region could allow the uptrend to gain traction.
If that’s the case, be ready for a continuation of the climb to the swing high or onto fresh record levels past R2 ($2,954.75).
Meanwhile, a long red candlestick closing below the area of interest and the 100 SMA dynamic inflection point near S1 ($2,793.35) could suggest that a reversal may be brewing.
Don’t forget to keep tabs on this week’s set of top-tier news events, as well as any headlines that could impact market sentiment, when taking any trades.
