NEW WEEK: USD HOLDS ABOVE 100: IS 42XX GOLD'S NEXT SELL ZONE?
Gold ended last week with a strong recovery after buyers successfully defended the lower boundary of the long-term descending channel. A combination of softer U.S. Dollar sentiment and weaker-than-expected U.S. data triggered a sharp rebound, allowing gold to recover toward the upper Fair Value Gap (FVG) and Fibonacci resistance zones.
However, from a macro perspective, the broader narrative has not changed. The U.S. Dollar Index continues to hold above the psychologically important 100 level, the U.S. economy remains relatively resilient, and the Federal Reserve has yet to signal a meaningful shift toward aggressive rate cuts. While markets have temporarily priced in a weaker Dollar, the underlying macro environment still favors higher real yields and limits the probability of a sustained bullish reversal in gold.
Technically, gold remains inside its broader descending structure despite the recent rally. Price is approaching the first major resistance cluster around the FVG, Demand, and Fibonacci confluence. This area will determine whether the current recovery can evolve into a larger structural reversal or simply become another corrective rally within the prevailing downtrend.
If buyers fail to produce a decisive breakout above this resistance cluster, selling pressure is likely to return as institutional liquidity continues to favor trend-following positions. On the other hand, only a clean break above the descending trendline and confirmation above the key resistance zone would invalidate the current bearish outlook and open the door for a broader recovery.
PRIMARY SCENARIO
Gold continues recovering toward the FVG + Demand + Fibonacci resistance cluster.
Failure to break this key resistance should provide another opportunity for sellers to re-enter in line with the broader bearish trend.
Only a confirmed breakout above the descending trendline would shift the higher-timeframe bias toward a more constructive outlook.
MARKET VIEW
Last week's rally was supported primarily by temporary USD weakness rather than a fundamental change in macro conditions. With the Dollar Index still trading above 100, the U.S. economy remaining stable, and the Fed maintaining a cautious policy stance, gold still requires a much stronger catalyst to sustain a long-term recovery. Until that catalyst appears, rallies are more likely to be viewed as opportunities to sell into strength rather than reasons to chase bullish momentum.
Current Bias: Bearish structure remains intact. Short-term recovery within a broader downtrend.
Key Focus: FVG + Demand + Fibonacci resistance, followed by the major descending trendline. Wait for confirmation before considering trend reversal.
LucasGrayTrading
However, from a macro perspective, the broader narrative has not changed. The U.S. Dollar Index continues to hold above the psychologically important 100 level, the U.S. economy remains relatively resilient, and the Federal Reserve has yet to signal a meaningful shift toward aggressive rate cuts. While markets have temporarily priced in a weaker Dollar, the underlying macro environment still favors higher real yields and limits the probability of a sustained bullish reversal in gold.
Technically, gold remains inside its broader descending structure despite the recent rally. Price is approaching the first major resistance cluster around the FVG, Demand, and Fibonacci confluence. This area will determine whether the current recovery can evolve into a larger structural reversal or simply become another corrective rally within the prevailing downtrend.
If buyers fail to produce a decisive breakout above this resistance cluster, selling pressure is likely to return as institutional liquidity continues to favor trend-following positions. On the other hand, only a clean break above the descending trendline and confirmation above the key resistance zone would invalidate the current bearish outlook and open the door for a broader recovery.
PRIMARY SCENARIO
Gold continues recovering toward the FVG + Demand + Fibonacci resistance cluster.
Failure to break this key resistance should provide another opportunity for sellers to re-enter in line with the broader bearish trend.
Only a confirmed breakout above the descending trendline would shift the higher-timeframe bias toward a more constructive outlook.
MARKET VIEW
Last week's rally was supported primarily by temporary USD weakness rather than a fundamental change in macro conditions. With the Dollar Index still trading above 100, the U.S. economy remaining stable, and the Fed maintaining a cautious policy stance, gold still requires a much stronger catalyst to sustain a long-term recovery. Until that catalyst appears, rallies are more likely to be viewed as opportunities to sell into strength rather than reasons to chase bullish momentum.
Current Bias: Bearish structure remains intact. Short-term recovery within a broader downtrend.
Key Focus: FVG + Demand + Fibonacci resistance, followed by the major descending trendline. Wait for confirmation before considering trend reversal.
LucasGrayTrading
Daily trend & Supply/Demand insights 📊
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High-probability zones & structured setups
Clear scenarios for better decision-making
Trade smarter with LucasGrayTrading 🎖
👉 t.me/+cZC_DmEr3OwzOTA1
High-probability zones & structured setups
Clear scenarios for better decision-making
Trade smarter with LucasGrayTrading 🎖
Exención de responsabilidad
La información y las publicaciones no constituyen, ni deben considerarse como, asesoramiento o recomendaciones financieras, de inversión, de trading u otro tipo, proporcionadas o respaldadas por TradingView. Obtenga más información en Condiciones de uso.
Daily trend & Supply/Demand insights 📊
👉 t.me/+cZC_DmEr3OwzOTA1
High-probability zones & structured setups
Clear scenarios for better decision-making
Trade smarter with LucasGrayTrading 🎖
👉 t.me/+cZC_DmEr3OwzOTA1
High-probability zones & structured setups
Clear scenarios for better decision-making
Trade smarter with LucasGrayTrading 🎖
Exención de responsabilidad
La información y las publicaciones no constituyen, ni deben considerarse como, asesoramiento o recomendaciones financieras, de inversión, de trading u otro tipo, proporcionadas o respaldadas por TradingView. Obtenga más información en Condiciones de uso.