Following last week's rate hike, gold has completed a dip-and-rebound cycle. Friday's trading session saw a steady climb during the Asian hours, continued gains in European trade, and a U.S. session that initially dipped before reclaiming losses, ultimately closing with a small bullish candlestick on the daily chart. This price action suggests a short-term bottom has been established, setting the stage for further upward movement.
The trading strategy for Friday was clearly defined, with expectations that the downside correction would remain limited. A long position was recommended above the 4335 support level, with a stop-loss placed directly at that level. The projection was that a breakout above 4380 would pave the way for gains toward the 4400 zone. The actual market movement closely matched these expectations, as gold first rallied to the 4400 area before pulling back to 4354 and then bouncing. The session ultimately closed just below the 4400 psychological barrier.
Analyzing the current chart, momentum appears to have slowed after Friday's European session pushed toward the 4400 mark. The second rally attempt in the U.S. session failed to surpass that peak, leading to a pullback. Today's Monday Asian session continues the corrective trend from Friday's close, a healthy consolidation phase. The market appears to be building momentum for a potential breakout above 4400. Should that level be conquered, the bullish trajectory is expected to extend further.
Gold is currently trading near the 4355 level. The focus remains on the 4335-4343 support zone. A confirmed stabilization signal in this area would warrant initiating fresh long positions, with a stop-loss exiting the trade if the price breaks below the recent low.
This article is for reference only and does not constitute investment advice. Investors should assume all risks associated with their trading decisions.
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