Gold (XAU/USD) has recently shown strong bullish momentum, pushing from the $3,930 region up to the recent high near $4,159. However, after this powerful rally, the market entered a short-term correction phase — currently trading around $4,105, right in a key Fibonacci retracement zone.
This pullback could offer a strategic buy opportunity before the next leg up. Let’s break down the technical picture.
1. Trend and Momentum
The overall trend remains bullish, confirmed by price action staying above both the 20 EMA and 50 EMA on the H4 chart.
The short-term decline appears corrective, not a full reversal, as buyers continue to defend higher lows.
The RSI remains above 50, suggesting the bullish structure is still intact, though a brief consolidation or dip may occur before another upward move.
2. Fibonacci Levels
Using the last major impulse (from $3,930 → $4,159), we can identify the following Fibonacci retracement zones:
| Fibonacci Level | Price (USD) | Key Insight |
|---|---|---|
| 0.236 | 4,105 | Current price zone — first support |
| 0.382 | 4,060 | Deeper but healthy correction level |
| 0.5 | 4,045 | Strong buy area |
| 0.618 | 4,025 | Final bullish defense level |
This area (4,060–4,100) aligns perfectly with dynamic EMA support — adding confluence for a buy setup.
3. Trade Setup
✅ Buy Setup (After Pullback Confirmation)
- Entry Zone: 4,090 – 4,120
- Stop Loss: 4,040 – 4,045
- Take Profit 1: 4,155 – retest of the previous high
- Take Profit 2: 4,200 – 4,220 – next resistance / target extension
- Risk-to-Reward Ratio (RRR): approximately 1:2.5
If the next H4 candle closes above 4,110–4,120 with a bullish body, that would signal strong confirmation for buyers to step back in.
4. Alternative Scenario (Breakout Play)
For aggressive traders:
- Buy Stop Entry: above 4,165 (breakout confirmation)
- Stop Loss: 4,115
- Take Profit: 4,220 – 4,250
However, waiting for the pullback entry offers better risk management and a more favorable RRR.
5. Technical Summary
| Strategy | Direction | Entry | Stop Loss | TP1 | TP2 |
|---|---|---|---|---|---|
| Pullback Buy | Long | 4,090–4,120 | 4,040 | 4,155 | 4,220 |
| Breakout Buy | Long | >4,165 | 4,115 | 4,220 | 4,250 |
6. Key Takeaways
- The bullish trend in gold remains intact despite the short-term correction.
- Buyers are likely to step in around the Fibonacci 0.382–0.5 zone.
- A clean break below 4,040 would invalidate the setup and signal deeper correction risk.
π Conclusion
Gold is showing a healthy retracement within a strong uptrend, offering a tactical buy opportunity between 4,090–4,120 USD, with clear targets at 4,155 and 4,220 USD.
As always, traders should monitor economic news, especially U.S. inflation data and Fed commentary, which can significantly influence gold volatility and direction.
⚖️ Legal Disclaimer
Disclaimer:
This article is for educational and informational purposes only and should not be considered financial or investment advice.
Trading CFDs, forex, and commodities involves a high level of risk and may not be suitable for all investors.
You should never invest more than you can afford to lose.
The author and publisher assume no responsibility for any losses or damages resulting from the use of this analysis.
Always conduct your own research or consult a licensed financial advisor before making any trading decisions.
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