4 min readOn the daily timeframe, gold has recently confirmed a new higher low before breaking above a short-term bearish trendline, marked as number 1. This breakout suggests that underlying strength remains intact and that the higher time frame bullish trend is still in play.
The broader structure continues to show a sequence of higher lows, supported by an ascending trendline marked as number 2 in green. This long-term trendline highlights the ongoing demand that has been driving gold higher over the past months.
At the same time, price appears to be developing a high time frame range, illustrated by the white dotted horizontal lines. When this type of structure forms near the top of a strong uptrend, it raises the possibility that we could be looking at a distribution range, especially if resistance levels continue to hold.
Despite this, gold remains in a technically strong position, particularly when viewed in the context of the 20 and 50 exponential moving averages on the daily chart. The 20 EMA, represented by the white line, and the 50 EMA, shown as the blue line, have acted as dynamic support. Price has repeatedly found support at one or both of these levels before resuming the overall uptrend.
Looking at the 4-hour timeframe, we can see that gold has formed a support zone around the 4-hour 20 EMA, which aligns with a horizontal support area marked as number 2 near 3,350. This level is currently acting as a base. If this area holds, it strengthens the short-term bullish outlook.
If price breaks below this zone, the next area to watch is marked as number 1, where the 4-hour 50 EMA aligns with the 0.618 Fibonacci retracement. This confluence could act as a secondary support level if the current one gives way.
To the upside, the first trouble area is marked as number 3, around 3,390. This could act as short-term resistance. If price breaks through this level, the next major resistance is located around 3,420, marked as number 4. Beyond that, the final level to monitor is the all-time high, marked as number 5, near 3,500.
As long as price continues to hold above key moving averages and forms higher lows, gold remains in a constructive position. A breakout above resistance could signal the next leg higher, but a confirmed rejection may suggest that consolidation will continue.
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