Gold Spot (XAU/USD) $3400 Incoming again??Gold Spot (XAU/USD) – 1H Chart:
Chart Overview:
Overall Market Context:
Gold is currently retracing after a strong downtrend from a swing high near the supply zone. Price is reacting near a key bullish trend line and a local swing low.
Key Technical Elements:
OBV (On-Balance Volume):
The OBV has broken out of its downtrend resistance, suggesting a potential reversal in volume flow.
This shift implies bullish momentum could be building.
Trendline & Structure:
Price is respecting a bullish trend line, which has acted as dynamic support across multiple touches.
The current swing low sits right on this trend line, suggesting a possible bounce scenario.
Fair Value Gaps (FVGs) – 4H:
Two FVGs are located above current price around the 0.28–0.5 Fibonacci zone, indicating a likely magnet area if price starts to retrace upward.
These FVGs may act as short-term targets or resistance zones.
Fibonacci Retracement:
Price is currently near the 0.618–0.65 retracement zone, a classic golden pocket reversal area.
If price holds this level, a bounce toward the FVGs and supply zone is likely.
Supply Zone:
The major resistance sits above at the supply zone formed around the previous swing highs.
A rejection here could signal a return to range or continuation lower if not broken.
Demand Zone :
Below current price, a strong demand zone is marked, which historically triggered a large upward move.
If price fails to hold the trendline/swing low, this would be the next key support area to watch.
Scenarios:
🔼 Bullish Case:
OBV breakout holds and price bounces from the trendline/swing low.
Price moves up into the FVG zones and attempts to reclaim the previous swing high.
If it breaks above the supply zone, the next logical targets would be the psychological levels (e.g., $3,400+).
🔽 Bearish Case:
Failure to hold the current trendline and swing low.
Break below could lead to a move toward the demand zone, possibly sweeping lows and filling deeper FVGs.
If volume remains weak on bounce attempts, continuation of the downtrend is likely.
Summary:
Gold is at a critical inflection point. The bullish trendline and swing low offer a potential reversal area, supported by a breakout in OBV. A recovery into the FVGs above looks likely if price can maintain this level. However, failure here would lead to a drop toward the demand zone. Traders should monitor volume, OBV continuation, and price action near FVGs for confirmation.
