XAU/USD Daily Analysis May 5, 2025 | Gold Price Trend Forecast

XAU/USD Analysis – Uptrend Pauses Near $3,260, Market Seeks Direction

Overview (May 5, 2025)

As of May 5, 2025, XAU/USD (Gold/US Dollar) is trading around $3,255 on the hourly chart, with the recent uptrend showing signs of pausing. Since May 2, a rebound had been ongoing, but resistance near $3,260 is capping further gains, leading to a corrective movement. Technically, the price is slightly above the 50-hour moving average, indicating a short-term bullish bias. However, the 200-hour moving average (red line) remains above the current price, suggesting that the medium-term trend is still downward.

Key Point 1: Relationship Between Moving Averages and Trend Sentiment

Currently, XAU/USD is trading above the 50-hour moving average (blue line), indicating a slight short-term buying advantage. However, it has yet to reach the 200-hour moving average (red line), which is acting as a resistance zone. This suggests that a breakout above the $3,260–$3,270 range will be crucial for future price movements. A clear break above this level could open the door for further rebounds.

Key Point 2: ADX and DMI Indicate Market Searching for Direction

The ADX (yellow line) is currently hovering around 0.10–0.15, indicating a "range-bound phase" without a clear trend. Meanwhile, the +DI (green line) continues to stay above the –DI (red line), suggesting that buying pressure is gradually gaining the upper hand. If the ADX rises above 0.20, it would be considered a confirmation signal for an emerging uptrend.

Key Point 3: Volume Stabilizing Amidst Market Tug-of-War

Compared to the initial rebound, trading volume has somewhat stabilized, indicating that the market is entering a phase of seeking direction. Notably, the $3,260 level has previously shown signs of strong selling pressure, and whether the price can break through this level will influence the next market development.

※Image Source: cTrader Platform

Future Outlook and Trading Strategy

• Can the Resistance at $3,260–$3,270 Be Broken?: A breakout above this range could signal a shift to an uptrend.
• Maintaining Support at the 50-Hour MA: Holding above this level may encourage buying on dips.
• Confirmation of Rising ADX: A move above 0.20 would be a sign to strengthen buying strategies.

Example Trading Scenarios

Bullish Scenario (Continuation of Uptrend)
Entry: Long position after confirming a breakout above $3,260
Take Profit Target: Around $3,280
Stop Loss: Below $3,250

Bearish Scenario (Targeting a Pullback)
Entry: Short position after confirming a pullback near $3,260
Take Profit Target: $3,230–$3,220
Stop Loss: Above $3,270

Summary:

XAU/USD currently exhibits a short-term bullish bias but remains in a "quiet tug-of-war phase" before a clear trend is established. It's important to assess the movements of the ADX, DMI, and moving averages comprehensively to determine the timing of a directional breakout. Pay close attention to the battle around the $3,260 level and consider trend-following strategies accordingly.

Disclaimer:

This article is intended for informational purposes only and does not constitute a recommendation to buy or sell any specific financial instruments. All trading decisions should be made at your own discretion.
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