FX.co ★ skyboy | XAU/USD, GOLD

Gold (XAU/USD) H1 Update – Bearish Bias After the Support Breakdown A few days ago I shared my Gold Daily analysis and my overall view was bearish for this week. The main idea was that Gold had started moving down from the higher resistance area and that the 4,500–4,600 region could act as a selling area. After looking at today’s H1 chart, I think the lower timeframe is now supporting that idea quite well. What I’m noticing first is the reaction from the 4,550–4,575 area, where the unmitigated bearish Order Block and sell-side liquidity were sitting. Price failed to break through that area and then started producing a series of lower highs and lower lows. The important move came when Gold broke down from the 4,375–4,425 support zone. This zone had been holding price several times, but the latest selling pressure pushed price below it. For me, that changes the short-term picture. Right now Gold is trading around 4,358, so I don't want to sell immediately after the breakdown. A retracement back toward the broken support would actually give me a much better setup. That 4,400–4,425 area is the zone I’m watching. If the old support turns into resistance and sellers defend it, I think the market has a good chance of continuing lower. There is also buy-side liquidity sitting around 4,300, which makes that an obvious near-term objective. Below that, the larger demand area around 4,225–4,250 becomes the next important zone.

From a fundamental perspective, Gold is also dealing with a more difficult environment for the buyers right now. The stronger August U.S. payroll report increased expectations for a possible Fed rate hike at the September 15–16 meeting. Current market pricing is around the high-50% area for a hike, while higher yields and a firmer dollar have already put pressure on Gold. The next two days are particularly important. U.S. PPI is due Thursday and CPI is due Friday, and both reports could significantly change expectations for the Fed's September decision. With inflation still a major concern, a stronger-than-expected number could support the dollar and put additional pressure on Gold. So technically and fundamentally, I currently prefer the bearish side. My Trading Plan Bias: SELL GOLD I don't want to chase the current move around 4,358. My preferred setup is a retracement into the 4,400–4,425 broken-support area followed by bearish confirmation. Sell Zone: 4,400–4,425 Invalidation: Above 4,460 TP1: 4,300 Main Target: 4,225–4,250 The idea is quite simple: the Daily chart already gave me the bearish weekly direction, and now the H1 chart has broken its support structure. So I’m looking for the retest, not the chase. If Gold comes back into 4,400–4,425 and sellers defend that area, that would be the setup I’m most interested in for the next move lower. With PPI and CPI coming next, I’ll also be keeping the position size under control because Gold can move very aggressively around U.S. inflation data. For now, my view is clear: Gold is bearish, and I’m looking to sell the H1 retracement into 4,400–4,425, targeting the liquidity around 4,300 and then the 4,225–4,250 demand zone.