A Clear Bearish Structure (READ CAPTION)1. Overall Trend: The chart shows a clear bearish structure for XAU/USD (Gold vs. US Dollar) on the 1-hour timeframe. Price is making lower lows and lower highs, suggesting strong downward momentum.
2. Key Zones:
• Support Area (Blue Zone around 2321): Price is reacting to this level with a potential bounce forming an ‘M’ structure (double bottom). This could indicate a short-term support or potential reversal area.
• Resistance Area (Pink Zone): Marked as a critical zone. The note “IF GOLD BREAKS THIS AREA WE CAN CLOSE OUR BEARISH TRADES” implies this is a key invalidation level for bearish bias.
• Target Point (Below 3190): Indicates a bearish target if price breaks the support and continues downward.
3. Trade Setup:
• It looks like a continuation short trade is being considered with the expectation that price will break the support zone.
• Good risk management is shown with a clear stop-loss area (above the pink zone) and target level.
4. Additional Thoughts:
• Watch how price reacts at the support zone. If it shows bullish momentum or fails to break strongly, the setup might become invalid.
• Confirmation with a bearish candlestick pattern at the support break could add confluence.
