XAU/USD | Where to now?

May 12

As you can see in the 2H chart of Gold, after reaching the Supply Zone yesterday and almost touching the April 20th NWOG Low, it experienced a heavy drop in price, going from 4774 all the way to where it is being traded right now, at 4671 level.

Currently, I expect Gold to go inside the 4H IFVG, and then stay above the Consequent Encroachment of the Gap, which is located at 4648 level. However, if Gold fails and goes below the Consequent Encroachment and stabilizes below it, further drop towards 4630, 4613 and 4600 will be very likely.

However, if Gold bounces back up, it can go towards the the 4687 level to retest the May 11th NWOG Low, should it break above it, I expect a rise towards 4701, which is the May 11th NWOG C.E., a break above this level and then stabilization above the 4710 could signal Gold going higher towards the 4750, 4774 and 4800 levels respectively.

We should take into account that any war related news comes out, it'll heavily impact the market. But for now, as the Strait of Hormuz is closed, Gold dropping in price and Oil going higher makes the most sense.

May 13

Trade active

Gold experienced a free fall last night, going from 4676 all the way to 4638, touching the April 6th NWOG Low, but then it bounced back up and went as high as 4727! It dropped again then afterwards, currently being traded at 4687, which is a key level for Gold and as long as Gold stays below this level, it's bearish and further drop towards 4600 could still happen.

Strong resistances are in Gold's way to go back higher, first is the 4710 level, and then there is the strong resistance in the 4725 to 4750 range, which is forcing gold to drop further, considering the demand zone that is awaiting Gold at around 4600 to 4620.

May 14

Trade closed manually

By examining the 2H chart of Gold we can see that It failed to stabilize above the 4710 and then 4687 levels, and after reaching the 4710 level, it dropped massively from there to 4680 that is being traded at right now.

There's a pool of liquidity below the 4668 level which I expect Gold to sweep the liquidity there and then we shall wait and see if it can keep itself above the 4648 level which is the Consequent Encroachment of the 4H IFVG. Should it go below the C.E. and stabilize there, further drop towards the 4630, 4615 and 4600 levels is very likely.