XAU/USD (Gold/US Dollar), a potential bullish bounce scenario is outlined as follows:
Support Levels:
The 1st support level at 1987.75 is identified as "An Overlap support," indicating a significant level where buying interest may emerge due to a historical clustering of support. This level suggests that previous buyers may step in to defend their positions or initiate new long positions.
The 2nd support level at 1974.91 is also noted as "An Overlap support," providing additional reinforcement of support in this area. Traders may anticipate increased buying activity around this level, potentially limiting further downside movement.
Resistance Levels:
The 1st resistance level at 2005.10 is highlighted as "Pullback resistance," suggesting a significant level where selling pressure may materialize after a price retracement. This level indicates that previous sellers might encounter resistance from buyers looking to capitalize on the recent downward movement.
The 2nd resistance level at 2012.91 is described as "Pullback resistance," indicating additional resistance at this level. Traders should be cautious as price approaches this level, as it may attract selling interest and potentially limit further upside movement.