Inverted Head & Shoulders pattern emerges on Gold's 4-Hour chart: Geopolitical turmoil acts as tailwind

Gold continues to build on its Asian session strength, rising to a fresh daily high around $3,345, supported by multiple bullish factors. The US Dollar remains under pressure amid growing expectations of additional Fed rate cuts, following softer inflation data released on Friday. Concerns over the US fiscal outlook further weigh on the greenback, providing a tailwind for gold.

Meanwhile, geopolitical tensions including the ongoing Russia-Ukraine war and renewed US-China trade friction have dampened risk appetite and boosted demand for safe-haven assets like gold.

With this latest advance, the yellow metal has reversed Friday’s modest losses, and the overall supportive macro backdrop points to the potential for further upside.

XAU/USD TECHNICAL OVERVIEW

Technical Structure: Gold formed an Inside Bar pattern on the Weekly chart, indicating indecision and potential for a breakout. The market opened with a gap up, largely driven by rising geopolitical tensions, particularly between Russia-Ukraine. On the Daily chart, price action is in consolidation, though the metal managed to close above the 20-Day Simple Moving Average. 4-Hour chart of Gold showcases the successful breakout of Inverted Head & Shoulder, leaving more room for the upside.

Weekly Trend: Neutral

Intraday Trend/ Intraday Strategy: The intraday bias remains Bullish and favours the strategy of buying on supports and buying on resistance breakout. 

Major Support: 3302, 3295, 3288
Major Resistance: 3360, 3390, 3414