XAUUSD – Inverse Head and Shoulders Pattern Still Active...XAUUSD – Inverse Head and Shoulders Pattern Still Active, Continue to Prioritise Buying at POC
I maintain the view that the current dominant trend is buying based on the inverse head–and–shoulders structure, and the bullish wave is not yet complete. The plan is to wait for price to retrace into the POC zone to re-enter with the trend, avoiding chasing buys at the highs.
🎯 Main Scenario – BUY THE DIP AT POC
Buy: 4,133 – 4,130
SL: 4,123
TP: 4,155 – 4,178 – 4,200 – 4,250 – extended targets if momentum remains strong
For me, total risk per trade never exceeds 1–2% of the account. A good setup with poor risk management is still a bad trade.
1. Fundamental Context
Gold is maintaining its upward momentum, trading near its highest levels in about two weeks.
The US Dollar is weakening as markets increase bets on the Fed cutting rates soon, following data showing continued cooling in inflation.
Lower yields and a softer USD reduce the opportunity cost of holding gold, supporting the flow back into safe-haven assets.
With this backdrop, I do not prioritise large sell setups. Most pullbacks are mainly opportunities for me to accumulate long positions.
2. Technical Analysis & Market Sentiment
On the H1 timeframe, gold has formed and activated an inverse head–and–shoulders pattern, confirming a bullish reversal phase.
Price is retracing to retest the POC zone around 4,133–4,130, overlapping the previous accumulation area where heavy sell orders were absorbed. This is the zone I prioritise for buying.
Below this lies a deeper FVG acting as secondary support; however, I’m not waiting for price to drop too far to avoid missing the core move of the pattern.
Regarding price behavior, recent pullbacks have been absorbed quickly, with multiple long-wick candles showing buyers are still in control. I’m waiting for a clean pullback into POC with a strong bullish reaction to trigger the entry.
3. Action Plan
Only enter positions when price returns to the 4,133–4,130 zone — absolutely no FOMO buying at higher levels.
Take partial profits at 4,155 – 4,178 – 4,200 – 4,250, leaving the remaining position open if gold continues to extend its bullish leg.
If price breaks below 4,123 and closes under that level, I will cut the trade immediately and reassess the structure — never hold on to a bias when the market has changed.
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