Technical Analysis of GOLD – December 6, 2024

From a technical perspective, I observe that the current price of Gold has reached a level worth considering for potential entry points.

Let’s review the 1-hour timeframe chart below before diving into the analysis:

Price Action Analysis (Trader's Pressure)

In the current market trend, GOLD is showing a bullish or uptrend condition. However, it's essential to anticipate a trend reversal if the price breaks the support area or moves into a consolidation phase.

By analyzing the candle history, there’s an opportunity to look for buy entries. To remain objective, I’ll provide an analysis for both buy and sell setups.

From the chart, we can see that buyer pressure (long green candles) is gradually driving the price upward, with sellers (long red candles) unable to counter effectively. This has resulted in the formation of higher lows, indicating that buyers are still dominating price levels. However, sell opportunities may still arise in this commodity.

On the chart, I’ve marked the resistance area between 2640.62 – 2635.56, and the support area between 2622.34 – 2617.53.

Entry Setups

1. Breakout Opportunity

• Buy Setup: If the price closes above the upper resistance area (2640.62) on the 1-hour candle, prepare for the best buy entry.

• Sell Setup: If the price closes below the lower support area (2617.53) on the 1-hour candle, prepare for the best sell entry.

  Stop Loss Guidelines:

  • For buy entries, set a stop loss if the 1-hour candle closes below the lower boundary of the resistance area (<2635.56).
  • For sell entries, set a stop loss if the 1-hour candle closes above the upper boundary of the support area (>2622.34).
    Maintain a minimum risk-reward ratio of 1:1.

2. Pullback Opportunity

• Sell Setup:
  If the price closes within the pullback area at resistance, take a sell position. Set a stop loss if the 1-hour candle closes above the upper boundary of the pullback area (>2640.62). Use a minimum risk-reward ratio of 1:1 according to your trading style.

• Buy Setup:
  If the price closes within the pullback area at support, take a buy position. Set a stop loss if the 1-hour candle closes below the lower boundary of the pullback area (<2617.53). Use a minimum risk-reward ratio of 1:1 according to your trading style.

Always use proper money management to maintain healthy trading practices, and be cautious of fake breakout candles that may mislead entries.

I hope this analysis serves as a helpful reference for your market trades.

Happy trading, everyone!

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