The XAU/USD chart shows that the ATR (Average True Range) indicator has reached its highest level in several weeks, signalling increased market volatility.

In addition, trading activity is being fuelled by heightened geopolitical tensions, now including an escalation of the conflict between India and Pakistan.

The price action analysis of the precious metal also provides valuable insight, highlighting the ongoing battle between supply and demand.

Technical Analysis of the XAU/USD Chart

On 23 April, we noted a sharp shift in sentiment after the price of XAU/USD peaked around $3,500.

Gold price fluctuations today suggest continued bearish pressure above $3,400, leading to a downward reversal at peak B, which sits below the previous high at A.

This forms the basis for outlining a descending channel and suggests that bears may attempt to keep the price within its boundaries. On the other hand, the $3,333 level was decisively broken by a wave of buying (shown with a blue arrow), and a bullish “cup and handle” pattern is emerging in the background — it is possible that, as part of the May rally, bulls may try to surpass peak B.

Whatever the outcome, elevated volatility appears likely to persist — especially with the US Federal Reserve’s interest rate decision due today at 21:00 GMT+3, followed by Jerome Powell’s press conference at 21:30.

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