Gold (XAU/USD) has reached a key liquidity zone above resistance, setting up a potential sell limit opportunity. This move reflects a classic liquidity grab, where smart money clears stop-losses before reversing the market.
Key Observations:
Liquidity Sweep: Price action spiked above a significant resistance level, triggering stop-losses and trapping buyers, suggesting a potential reversal.
Market Structure: Bearish signals, including rejection candles and waning momentum, indicate a possible downside move.
Optimal Entry: A sell limit at [specific price level] aligns with the liquidity grab and anticipated reversal zone.
Trade Plan:
Entry: Sell limit at [specific level], positioned for a move downward from the liquidity zone.
Stop Loss: Above the liquidity sweep to account for market volatility.
Take Profit: Targeting key support levels around [specific levels] for a favorable risk-reward ratio.
Risk Management:
This setup leverages the liquidity sweep for a high-probability trade, but disciplined risk management is crucial. Monitor for confirmation of bearish momentum before full execution.