Gold (XAU/USD) is at a critical juncture, testing a key Fibonacci barrier as a clear bullish ABCD pattern emerges from the recent sell-off. However, a decisive close above $5,141 is required to confirm the breakout.
🔹 Resistance in Focus
Gold is pressing against a resistance zone capped at $5,141—the 61.8% Fibonacci retracement of the prior downtrend. While Wednesday’s high of $5,119 cleared a prior swing high, the rally lacks confirmation until price closes firmly above the Fib line.
🔹 Pattern Confirmation
The structure has strengthened following a textbook bounce off a 61.8% retracement level at $4,655. With the second leg up now confirmed above the $5,092 swing high, the rally is technically validated.
🔹 Upside Target: $5,342
If bulls succeed, the next major target sits at $5,342—a level backed by both the 78.6% Fibonacci retracement and a 100% projection from the ABCD pattern. This is where the rally would show symmetry, often signaling a potential turning point.
🔹 The Bull Trigger
A daily close above $5,141 is the confirmation signal. Without it, gold remains in a resistance test, not a breakout.
🔹 Downside Risks
If rejected, initial support lies at the 20-day moving average ($4,936) and this week’s low of $4,965. A drop below $4,655 (point C in the pattern) would invalidate the bullish setup and signal a deeper pullback.
