FX.co ★ FlyWithEagle | XAU/USD, GOLD

Gold XAU/USD Analysis H4 Minutes Timeframe December 21, 2025

The 4‑hour XAUUSD chart shows a clear bullish environment, marked by a decisive Break of Structure (BOS) to the upside and sustained trading above that level. Price previously swept a cluster of liquidity above the prior swing high, then reversed sharply, confirming that this zone was a significant external liquidity pool where late buyers were trapped and smart money used the opportunity to sell. After the BOS, the market formed a new series of higher lows and higher highs, indicating that institutional order flow has shifted in favor of buyers. The current price action is consolidating near the recent high, suggesting that the market is building energy for another move, either to continue the uptrend or to engineer a deeper liquidity grab before continuation. From a liquidity perspective, internal range liquidity lies within the consolidation structures that formed after the BOS. The equal‑like lows and minor pullbacks between the BOS and the current price represent pools of stop‑loss orders from short‑term traders. These internal liquidity pockets are often targeted first before the market makes a larger directional move. External range liquidity, in contrast, sits beyond the clearly defined swing points: the key external liquidity above the current range is just beyond the recent high marked as “BOS” on the chart, where breakout buy stops and buy‑side liquidity accumulate. On the downside, external sell‑side liquidity rests below the major higher low that initiated the latest impulsive leg up; if price revisits that area, it would likely be with the intention of filling institutional orders before resuming the prevailing trend. The most relevant order block on this chart is the bullish order block that formed right after the strong BOS to the upside. This order block is identified as the last bearish candle (or small bearish cluster) before the impulsive bullish rally that broke structure and left an inefficiency behind. Price has since respected this zone by reacting to it on subsequent pullbacks, reinforcing its validity as an institutional demand area where large buy orders were previously placed and may still remain unfilled. As price hovers near the recent highs, any corrective move down into this bullish order block can be viewed as a high‑probability rebalance, where the market revisits a premium demand zone to collect internal liquidity, mitigate institutional positions, and prepare for a new expansion to the upside toward fresh external liquidity. A logical trade setup is to wait patiently for price to return to that 4‑hour bullish order block while staying aligned with the dominant uptrend. A conservative approach would place a buy limit order within the body of the order block, with the entry slightly above its midpoint to increase the chance of being triggered while still obtaining a discounted price relative to the current market. The protective stop‑loss should be positioned just below the low of the order block and below the nearest internal liquidity cluster, ensuring that if the market violates that level, the premise of bullish accumulation in that zone is invalidated. The initial take‑profit target would be set at or slightly above the most recent significant high, aiming to capture the next sweep of external buy‑side liquidity. A more aggressive trader could scale out: partial profits at the previous high, then leave a runner toward the next projected extension level, trailing the stop beneath newly formed higher lows. This structure‑based plan uses internal liquidity sweeps for entry, the order block as the execution zone, and external liquidity as the destination, maintaining a coherent, rule‑driven framework for trading this chart.