On Friday, gold experienced significant movement following the FOMC data release. As anticipated, there was a downward move followed by a swift recovery. The price encountered some resistance around the 2378-84 area, but the market actually took resistance from the 2374-75 level, leading to a 100-pip correction. Toward the end of the session, it successfully broke through this resistance and closed above the 2384 level.
Now, the next key resistance lies in the 2405-2419 area. Given gold's continuous impulsive movements without significant corrections, we expect the market to open with a gap and reach the 2405 area easily. The 2400 level, being a psychological barrier, might cause some rejection due to the presence of numerous short-sell orders. From the 2406 area, the price may retrace to the 2388 and then the 2369 area. If this level fails to hold, the 2340-2327 area could be an excellent buying opportunity, as it aligns with the golden Fibonacci level.
On the upside, if gold forms a strong bullish H4 candle closing above the 2420 area, be prepared for new highs. Additionally, one can consider buying if an H4 candle closes bullish above the 2420 area, targeting 100-250+ pips with a stop loss at 2400.
We recommend against buying at high prices; always wait for a retracement. In our case, the most preferable buying area would be the 2369-2360 range, as this zone has previously acted as strong resistance and may now serve as strong support. Additionally, this area is identified as a breaker block according to the smart money concept.