XAU gold’s previous large bearish candle plunged directly from around 4120 to below 4095. The next few candles moved sideways at lower levels. Although price dipped again to 4075 during this period, it quickly recovered, indicating that the pressure to keep shorting at low levels has eased somewhat. The one-hour chart is now beginning to show an attempt to form a bottom and rebound, but 4108–4120 above is a resistance zone created by the earlier accelerated drop, so the rebound may still face selling pressure. Overall, gold has a short-term need for a technical recovery, but the four-hour downtrend remains dominant. Continue to trade with the trend and look for entry opportunities on a rebound.
Sell gold in the 4108–4116 range, with a first target of 4080, then 4050. Stop loss above 4128. $XAU
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