FX.co ★ XAU/USD, GOLD

The daily gold chart shows a complete structural evolution over the past four months, transitioning from a sustained downtrend to a strong uptrend, and is currently in a healthy consolidation phase. From mid-May to late July, gold prices declined steadily, from around $4,729.45 to a major cyclical low around $4,029.10, characterized by extremely low levels. Throughout May and June, consecutive daily candles were constrained by bearish red and blue moving averages, which closely followed the lower Bollinger Band, indicating overwhelming seller dominance. Rebounds during this period were consistently limited by the moving average resistance between $4,529.35 and $4,629.40. This bearish momentum finally ended in late July, with gold prices forming a strong double bottom pattern between $4,029.10 and $4,129.15. By halting further declines to new lows and consolidating within a narrow trading range, the market successfully laid the structural groundwork for a significant trend reversal. In early August, a crucial shift occurred in the overall market structure. Gold successfully held the support level at $4,029.10, setting a new low, and then decisively broke through the descending moving average during the rally on August 3. This breakout marked the complete end of the previous downtrend and the beginning of a new bullish cycle characterized by higher highs and lower lows. Gold prices rallied from $4,029.10 to around $4,329.25, then briefly dipped to $4,229.20 before continuing their ascent to $4,529.35, consolidating around $4,422.95, and finally peaking at $4,729.45 on August 19. Every pullback in this uptrend was minimal, finding strong support near the ascending moving averages—a typical feature of a healthy uptrend. Subsequently, the moving averages crossed to form a single bullish line, trending upwards in parallel, with the spot price holding above it. Simultaneously, the Bollinger Bands widened significantly after breaking through them in August, mathematically confirming a strong shift in market momentum and volatility towards the upside. Gold is currently trading around $4,422.95, in the middle of its total August price range after falling to a record high near $4,729.45. The price action between August 19 and September 4 represents the first significant pullback in this emerging uptrend. After rising to $4,729.45, several bearish candles with long upper shadows appeared, followed by a pullback below the upper Bollinger Band, with the price settling near $4,329.25. Because this pullback remained above the previous low of $4,229.20, the overall sequence of higher highs and higher lows remains intact. Recent daily charts show buyers attempting to establish a stable bottom around $4422.95, a level well above the ascending blue moving average of $4417.10 to $4434.72. This technical convergence forms a key dynamic support zone that could determine the direction of the next major move. Looking ahead, and assessing the main technical indicators, immediate resistance lies in the $4529.35 to $4629.40 area, the pre-breakout moving average zone that briefly constrained market action mid-month. A decisive daily close above $4529.35 would signal the end of the current pullback, paving the way for a direct retest of the $4729.45 high. A break above $4729.45 would target $4829.50, indicating a continuation of the August rally. Furthermore, the continued expansion of the upper Bollinger Band suggests ample room for a potential second wave of upward movement if buying momentum is reinforced once again. On the downside, the key resistance level lies at 4329.25, which coincides with the recent low and the midline of the Bollinger Band. Holding above 4329.25 will maintain the strength of the short-term uptrend. A break below this level would provide stronger support around 4229.20, which represents the key high formed before the rally to 4729.45.