**Gold (XAUUSD) Price Structure Hints at July Correction**
*By Justin Bennett | Adapted and Expanded for In-depth Analysis*
Gold (XAUUSD) has been among the most watched assets in the financial markets in 2024. Following an impressive uptrend that took it to record highs earlier in the year, the price action of XAUUSD is giving signs that the precious metal could be on the brink of a meaningful correction during July. This article will provide extensive technical analysis, key levels to watch, and examine the macro and sentiment drivers that could influence gold over the coming weeks.
—
## Technical Analysis of Gold Price
Throughout the first half of 2024, gold maintained a strong bullish momentum. In May and early June, XAUUSD set all-time highs above the $2,400 mark before retreating toward the $2,300 zone. This run was supported by both fundamental and technical factors, with much of the recent price action reflecting anticipation of global economic shifts, geopolitical tension, and speculation surrounding the US Federal Reserve’s rate path.
### Key Technical Developments
A closer look at the daily chart reveals a clear structure forming:
– **Uptrend Support Line**: The trendline extending from the swing lows of late February and early March provided formidable support through much of the rally. Prices have recently tested this line, hinting at a possible shift in sentiment.
– **Horizontal Resistance Near All-Time Highs**: Price struggled to close above the $2,450 area, forming a double-top pattern. This type of structure often indicates exhaustion in the prevailing trend and is a classic prelude to corrective phases.
– **Short-Term Lower Highs**: Since the peak, gold has produced a sequence of marginally lower highs, underscoring weakening bullish momentum.
– **Bearish Candle Signals**: Daily and weekly candlestick patterns around the highs, such as shooting stars and bearish engulfing candles, signal a potential change in direction.
– **Dual Support Zone**: The $2,285 to $2,300 area marks an important confluence of support, combining previous resistance-turned-support levels and the ascending trendline in place since March.
### Chart Patterns Hinted Correction
Technical chartists attach significant weight to patterns and structural clues. The recent developments in gold underline the following points:
– Double-top patterns suggest buyer exhaustion.
– Breakdown below trendline support could trigger accelerated selling.
– Sideways consolidation over the past several weeks signals indecision and mounting pressure for a breakout.
—
## Key Price Levels to Watch
For trend traders and swing traders alike, price structure offers probable levels for entries, exits, or confirmation of larger moves. As gold’s consolidation appears to near resolution, the following levels merit close attention:
### Resistance Levels
– $2,380 – $2,400: Immediate resistance, corresponding with prior failed breakout attempts and psychological significance.
– $2,450: All-time highs, marking the upper boundary of recent double-top formation.
### Support Levels
– $2,325 – $2,330: Short-term support within the current consolidation range.
– $2,285 – $2,300: Major support and the neckline of the double-top. A clear breakdown below this zone could open the door to further weakness.
– $2,200 – $2,220: Next significant downside target if the $2,300 area fails, coincides with former range resistance and a prominent swing low.
—
## Macro and Sentiment Drivers
Technical signals are only part of gold’s story. Macro fundamentals and sentiment will likely play a decisive role in whether any correction develops into a larger reversal or just a modest pullback in an ongoing bull market.
### Fed Policy Outlook
Gold’s historic run in 2024 was greatly underpinned by expectations that the US Federal Reserve would soon pivot to rate cuts. This sentiment prevailed amid signs of cooling inflation and late-cycle economic growth. However, recent US economic
Read more on GBP/USD trading.