Gold at range edge — break below 4,000 or push to 4,116? | XAUUSD July 28

Hey everyone, this is Daniel, your prop trader. For gold today, I'm leaning slightly bearish for now. Right now on the 1H chart we've got a sideways range forming, and since it's a sideways range, it's tough to say which direction gold's really going to pick from here.

Basically we wait for a breakout, read the direction it gives us, then switch our bias and trade in line with that move. That said, the recent downtrend has been dropping with pretty strong momentum, so given that setup I'd say our default bias here should clearly lean to the downside. Last time it played out exactly like the scenario I shared in the community: price broke below this range built in the Tokyo session, gave us a pullback, and then dropped roughly 405 pips lower.

Today, the first thing to watch is which way this sideways range breaks out. I've walked you through exactly which price points to focus on, and how to decide when to flip your directional bias and adjust your entry approach. Alright, let's dive straight into the daily chart.

On the daily, yesterday's candle closed as a bearish doji — a doji that finished with a lower body. This means the follow-through from the most recent candle has failed here, so overall we're in a situation that leans quite naturally toward the bearish scenario playing out. So how might this bearish scenario actually unfold?

I think there are broadly two possible paths we can map out here. The first is that this bullish doji here becomes the reference candle, and price forms a sideways range from it. The second, and I'm sorry to keep repeating the same point, is a move where price tries to test the low of this bullish candle.

I think this kind of scenario is quite likely to unfold. As for the bullish scenario, I do think the odds of it actually playing out are pretty low, but it's still one view I want to keep on my radar going in. If today's daily candle prints a bullish price action that clears yesterday's high, or if we form a nice, clean reversal candle right here at this level, then in that case, the odds of a push toward this high really increase We can also read the previous day's bearish doji here, essentially a bearish pin bar, and that pattern is clearly forming right now.

So the price tends to push higher, sweeping the stop-loss orders from bears who shorted seeing this. As I mentioned in the previous video, the idea that the high near this candlestick would act as our upper ceiling is now breaking down. Price now has room to fully recover, sweep higher, and push up strongly.

If that plays out, the odds of a clean breakout rise sharply, so this is definitely a scenario we need to keep on the radar and factor into our plan. That wraps up the daily chart, so now let's move on to the 1H timeframe. On the 1H, I ran a members-only stream for the community the previous day, right around this red line, where the range had formed.

Just so you know upfront, what I'm about to walk you through is a portion of what I'd already explained inside the community. First point I'd been thinking about: the Tokyo session stayed in a trading range, lacking clear direction. And for the intraday view, we need to frame our bias in the direction of this trading range breakout.

The price action leading up to here was a very strong uptrend with real momentum. The open printed a pull gap right at the opening bell. So the main scenario I laid out was a breakout to the upside.

Now, about how I think when it comes to trading, I do make forecasts, but that's really just for the video's structure. When trading, I honestly think forecasts mean absolutely nothing. So I'll walk through moves in both directions, and I'll show you exactly what price action would flip my bias.

The Tokyo session low from the prior day sat right around this area here. If price breaks below this level with strong downward momentum, that's the key signal here. I explained you switch your bias here and shift to a bearish view.

And I walked through these two scenarios, along with the reasoning and the price action process that led me to actually consider both of them. One thing I was really watching was this candle here. This is likely the move that became the starting point for the whole uptrend.

After forming a minimal double bottom here, price breaks out above the point where the shorts were likely placed. After that it finds support, and a second leg higher starts to build up from there. On this particular level, I have my own personal read.

I usually work out my expected pullback levels without relying on Fibonacci retracement tools at all. Rather than pricing this out, I'm looking at where opposite positions are stacked. I focus on those key points and build my trade ideas around them.

For example, this big bearish candle marks where shorts were likely opened. It's an entry point, and stop loss orders also tend to cluster right around here too. So after a break above, expect it to act as support just like a normal horizontal line.

So the plan here is to look for pullback buying opportunities at levels like this. Now if we track this whole run of price action that follows here, we can see this clearly isn't an environment where the sellers are in control. The reason is, if you focus on the down swing right after the up swing ended, the candles almost fully overlap, so it looks less like a swing and more like a flat range And here too, even near the close, price never broke below the recent low here Up to this point we had a really strong downtrend with heavy bearish momentum I figured control was shifting to the bulls, so my bias here is to the upside.

And in the end, we opened with a clear bullish gap here. This level is clearly being watched as a key buying zone here. So an upside breakout looks the most likely scenario here.

Right here we've got two swings — even taking the broad view, two upside swings, that classic two-leg move is confirmed on the chart. So from here the bias basically stays to the upside. After the breakout, if the move was strong, this was a clear setup to wait for a pullback and enter.

So how did gold actually play out? A flat range in the Tokyo session, then a fairly strong momentum move broke out to the upside there. After that we get a clean, textbook pullback move here.

It closes out, builds this sell setup, then drops hard from there. We saw it drop roughly $40, which works out to about 405 pips lower here. So this played out pretty much as the scenario called for.

Today's exclusive content for our community covers this. I'm breaking down today's price action into three key points here. First point: don't flip your bias just because of one reversal candle alone.

This is a really important mindset. Just memorizing a few patterns won't make you a consistent winner. You watching this already know this.

The price action here matters a lot. Now let's see how this plays out next. whether we treat this as a strong bullish signal.

I'm also thinking about how price develops after breaking the recent bear channel. Basically, as I mentioned at the start, we've got a sideways range forming here. Keep in mind you may need to reset your bias in the direction of the breakout too.

Here I'm explaining why you shouldn't try to trade off a single price action pattern alone. Right now, gold's near-term bias is to the downside. And that wraps up today's analysis.