On March 19, gold prices declined significantly. After fluctuating during the Asian session, the market broke below the key support level of 4967 during the European session, opening the door for further downside. The sell-off continued during the U.S. session, influenced by the interest rate decision, resulting in a large bearish candlestick for the day.
In our previous analysis, we identified 5031 as a resistance level and emphasized monitoring the breach of the 4967 support. The 4967 low had been tested multiple times, and we noted that a decisive break below this level would confirm a bearish breakout, fully unleashing downward momentum. Once the level was broken during the European session, a breakdown short strategy was recommended to capture accelerated declines, with further selling anticipated during the U.S. session.
In the current market structure, the breach of 4967 triggered a sharp decline, with prices falling continuously to around 4834. During late trading, influenced by the Federal Reserve's announcements, prices broke to new lows, approaching the 4800 mark. Given yesterday's breakdown and the strong bearish closing, selling on rebounds is the preferred strategy today. Trading should focus on shorting during weak bounces rather than chasing the market lower blindly.
The key resistance to watch is the 4900 level, which marks the opening decline zone from the early morning session. This level serves as an intraday dividing line; as long as gold remains below 4900, the overall trend remains bearish. A short position was already taken during the early morning session. The next move will depend on the European session's rhythm, with further short positions planned during the U.S. session. The primary strategy is to anticipate continued weakness below 4900, selling on rallies with a defensive stop above 4900. If the European session rebound fails to surpass 4880, actively short below this level, with a protective stop at 4880 and a target profit of 40-50 points.
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