XAUUSD ON BEARISH

On the H4 chart, XAU/USD remains in a critical consolidation phase, with the supply zone at 2640-2590 acting as a ceiling and the demand zone at 2580-2540 providing robust support. A break above 2590 could spark bullish momentum, while a breach below 2540 may confirm further downside.

On a daily basis, the broader trend suggests potential bearish momentum, with price action showing lower highs and increased selling pressure. If key support at 2540 is broken, XAU/USD could target lower levels, potentially extending to 2500 or beyond. Traders should watch for daily close confirmations and align with overall market sentiment.

Given the upcoming New Year holidays, liquidity could be thinner, potentially leading to more erratic price movements or slower reactions to breaking key levels. Reduced trading volumes around this time might amplify volatility, making it crucial to approach trades with caution and to account for the possibility of whipsaw price action. Traders should be prepared for unpredictable shifts and monitor the broader economic landscape, as global factors, including market sentiment, could further impact price behavior.

Author - Dollarpip