Hi, traders, XAU/USD has finally broken a significant level of 2432 with a high-volume candle. I have attached an image to show you two scenarios that might happen.
Scenario 1:
Testing the Imbalance. The first scenario is that the market turns back to the area of 2432 to 2435 and consolidates down there. There is an imbalance in this area, and the market might come down to test before moving upward. Essentially, this is a test to confirm if the breakout is strong or if it is imbalanced, and the market is filling the imbalance.
Scenario 2:
Upper Movement. In the second scenario, the market could very well move to the levels of 2444 to 2451, where it is today. Basically, it will do what it did yesterday when it chose the nearest ob and moved upward. The significant level here is 2451, which is the high. The breakout of the high with a high-volume candle will indicate that the market has an inclination to go higher.
Mark movement: As per the scenarios, I believe the market could very well come down and test the 2432 to 2435 area. And market can test the nearest order block and after tested the area market likely move on upward direction.
However, the market will have a good breakout strength if it reverts back from here and consolidates upward. It is likely that the market will break 2451 with volume, but it will test back here once more before moving upward. There is a possibility that the market may six to make a new all-time high at 2483. However, this is the likeliness that the market will first go up there, perform a slow liquidity hunt and then correct down. Though I do not expect another deviation soon as the volume is increasing.
Important Levels
2432: This is the level of the recent breakout, and will watch if there is any rejection
2432 to 2435: The aforementioned area having an imbalance that could be tested
2444 to 2451: The current market levels, which could break out with a very high volume
2483: The all-time high, the target of the market. Expect a liquidity hunt and correction afterward. Before performing any trade, ensure all the entry confirmations are completed, such as:
* Liquidity hunt – sign that the market is looking for pools of liquidity
* Order block – order block breaks and defend institutional orders
* FVG price – price gap likely to fill
* Breaker block – break resistance or support
* Clear key levels – all are clearly in inertia.
Conclusion
In conclusion, XAU/USD has seen a major breakout at 2432, and the chances are that it moved towards testing the imbalances and higher levels. Notably, 2432, 2430 to 2435, 2444 to 2451, and 2483 are critical levels, there are. It is crucial that one looks for the entry confirmation before taking any trades. As such, people who watch over these levels and market reactions make proper trading decisions and enjoy the opportunities the XAU/USD movements present.
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