Gold reverses its short-term uptrend, breaking through support at 2639 – 2631. Explore bearish targets at 2553 – 2536, key resistance levels at 2647 – 2641 and 2678 – 2670, and strategies for confirming trade entries.
Gold’s short-term uptrend has come to an abrupt halt after breaking through the key support zone of 2639 – 2631. This decisive move has shifted market sentiment to bearish, with traders now eyeing the lower Target Zone of 2553 – 2536 as the next significant support level.
Bearish Targets in Focus
With the support level broken, the path downward appears to be in play. The Target Zone of 2553 – 2536 serves as a key area where prices might stabilize in the short term. Traders looking for short opportunities should focus on entry points at resistance levels, ensuring proper confirmation before executing trades.
Key Resistance Levels for Short Trades
For those considering short positions, the following resistance zones are critical:
- 2647 – 2641: This is the first major resistance where selling pressure is likely to emerge.
- 2678 – 2670: A secondary resistance zone, where traders should watch for additional bearish signals.
To confirm entry points near these resistance levels, look for candlestick patterns or other technical indicators that signal a potential reversal. This confirmation will reduce risk and increase the probability of successful trades.
When to Consider Long Trades
For bullish traders, the price must pierce and consolidate above the 2678 mark during the US trading session. A strong close above this level could indicate a return to bullish momentum and provide an opportunity for long trades.
- Key Bullish Signal: Sustained price action above 2678, supported by strong volume and buying pressure.
- Bullish Targets: Initially aim for the December high near 2726 if the price holds above the resistance zone.
Trade Strategies to Consider
Short Trade Setup:
- Monitor for price rejection near 2647 – 2641 or 2678 – 2670.
- Confirm entry with bearish candlestick patterns or resistance break rejections.
- Target: 2553 – 2536, with stop-loss above the resistance zone.
Long Trade Setup:
- Wait for a clear breakout above 2678 with consolidation during the US trading session.
- Enter long trades aiming for the next resistance at 2726.
- Place stop-loss below the breakout level to minimize risk.
Conclusion: Prepare for Both Scenarios
Gold’s price action has shifted to bearish territory, offering opportunities for short trades while keeping an eye on potential bullish reversals above key resistance levels. Traders should remain vigilant for confirmation signals to ensure precise and calculated entries.
Stay updated with daily insights and technical analysis on TheInvestingForex.com, where we provide actionable trade setups for gold and other key markets.