XAUUSD: at Key Resistance - Pullback Scenario in Focus To $5,400
Hello everyone, here is my breakdown of the current XAUUSD setup.
Market Analysis
XAUUSD is trading within a broader bullish structure that previously developed inside a well-defined upward channel. After a prolonged consolidation phase marked by a clear range, price broke to the upside, confirming buyer control and initiating a strong impulsive rally. This breakout from the range acted as a key structural shift, pushing gold into an accelerated bullish phase supported by higher highs and higher lows within the ascending channel. As price continued higher, XAUUSD approached a major higher-timeframe Resistance Zone around the 5,580–5,600 area. This zone has historically acted as a strong supply region, and current price action suggests that bullish momentum is starting to weaken near this level. The market is now showing signs of overextension after a near-vertical move, increasing the probability of a corrective pullback. Importantly, price is currently trading at the upper boundary of the ascending channel, where buyers often begin to take profits and sellers look for short-term opportunities.
Currently, a clearly defined Support Zone around the 5,380–5,420 area aligns with the prior breakout level and the upper boundary of the former consolidation. This zone represents a key area of interest, as it previously acted as resistance before being broken and now serves as potential support. The structure suggests that a pullback into this zone would be a healthy correction rather than a trend reversal.
My Scenario & Strategy
My primary scenario is a short-term corrective pullback from the Resistance Zone toward the Support Zone. As long as price remains capped below the 5,600 resistance and shows rejection from the upper channel boundary, I expect a move lower tow