Introduction
As of the time of writing, 05 Nov 2024, the XAU/USD is under strong intraday selling pressure. As shown below, this update specifies some important levels and, more importantly, the trading strategy for today: XAU/USD is expected to increase in value by around $6.00-$17.00 today. Nevertheless, on the back of bearish momentum, it pays to sell.
Our preferred strategy today is short at 2740.00, targeting 2722.00 first and potentially pushing on to 2711.00. This setup also fits in with the overall technical indicators, including the bearish RSI, wherein we would expect further price movement to be downwards.
Support and Resistance Levels for XAU/USD on November 5, 2024
The present market structure in XAU/USD has excellent support and resistance levels with which trading decisions can be made. The following information is on the critical levels:
Resistance Levels:
2755.00 – this is the upper resistance; a break and sustain at the level may mean a sharp reversal.
2746.00 – secondary resistance is indicated, and selling pressures are experienced.
2740.00 – Support acts as a fulcrum and resistance at the same time and can be treated almost as a threshold of the current bearish tone. Continued show below 2740.00 will support our short position.
Support Levels:
2728.00 – Last intraday support which can stabilize the price if there is enough buying interest in it.
2711.00 – Major support falls in line with our extended target for our short.
2700.00 – a very important support area, in which buyers may come in to cap the price.
As the RSI is moving lower and has turned bearish, it means the downtrend will be sustained. Those levels can be useful for trades and positions management.
Preferred Trading Position: Sell Short
Going short below 2740.00, as deduced above from the analysis. Here’s the full construction of the trade:
Entry: Enter a sell short position below the pivot at 2740.00, a resistance level, and today’s session pivot.
First Target: Set the first target for 2722.00, based on market sentiment and technical signals.
Extended Target: Should the downtrend continue, then one would hold on to the trade and aim at 2711.00 as the extended target.
Position Stop Loss: The stop loss should be positioned around the area a little above the 2740.00 pivot, ideally at 2746.00 so that it does not allow for some surprise upside movements.
Technical Indicator Analysis: RSI and DeMarker
Analysis of RSI
The RSI is showing bearish conditions, meaning XAU/USD has an advantage in the short position strategy. A lower-range RSI would mean that selling pressure is higher and the asset might move down further. Traders will have to keep an eye on the RSI since any surprise change will modify the intraday trend.
DeMarker Indicator and Its Implications for XAU/USD
The DeMarker Indicator, or DeM, is another useful tool for ascertaining probable reversal signals and identifying trend strengths. Unlike the RSI, the DeMarker Indicator is an indicator that compares high and low prices over some period to find if the asset is overbought or oversold.
For today’s XAU/USD strategy, more space to the downside is implied by a decreasing reading below 0.5 on the DeMarker indicator. It would confirm the bearish mood. More about a reading closer to 0.7 or above means there is a chance for a rebound, and traders would pay attention before entering short or holding short positions.
Intraday Strategy Execution and Key Takeaways
The XAU/USD trading strategy for November 5, 2024, would go short below 2740.00 to eventually reach 2722.00 and then 2711.00. Resistant levels in 2755.00, 2746.00, and 2740.00 can cap the market’s up Move, and supportive levels of 2728.00, 2711.00, and 2700.00 are exit points.
With technical indicators like RSI and DeMarker aligned with our strategy, trading decisions would be even more effective, and entry/exit points could be fine-tuned. Risk management during volatile sessions would be further optimized by maintaining a stringent stop loss.
Conclusion
For intraday trading, this XAU/USD perspective on November 5, 2024, outlines a constructive way to sell short as is complemented with bearish readings of the RSI and the support DeMarker setup. Whenever the price goes below 2740.00 and targets 2722.00 followed by 2711.00, this actually works as a quite rationalized way to follow up this movement in the market based on a downward price move.
