Peter Smith
Gold (XAU) appears to be gearing up for its next move, and sharp traders are already watching the clues unfold. In a recent post in Tweet, the 1-hour XAU/USDT chart shows signs of classic bullish absorption — a setup where price refuses to fall despite growing sell pressure. When this happens quietly, and near key technical zones like VWAP, it often precedes a meaningful shift in trend.
Currently trading at $3,344.8, gold is clinging to support even as cumulative sell volume accelerates. That’s exactly the kind of mismatch between price and flow that can set up an explosive rebound.
Buyers Soak the Dip as CVD Drops — Absorption in Action
The most striking feature on the chart is the clear divergence between Cumulative Volume Delta (CVD) and price. While CVD has trended lower, signaling heavier sell-side activity, price has stayed surprisingly stable — especially above VWAP (the purple benchmark line used by institutions).
This tells us that large buyers may be stepping in passively, absorbing market sells without chasing price. In technical terms, it’s a textbook case of bullish absorption, where the market shakes out weak hands while the smart money quietly positions ahead of the move.
Volume & Momentum Say “Wait for the Coil”
The story doesn’t end there. Trading volume remains relatively muted, which might seem bearish on the surface — but in context, it supports the idea of accumulation in a low-liquidity environment. Add to that the Money Flow Index (MFI) sitting around 39.58 (leaning into oversold territory), and you’ve got a setup where momentum could flip fast.
The CVD chart shows lower highs (LH) while price forms higher lows — a compression pattern that typically leads to a breakout. This coil is forming right around key liquidity levels and trend pivots, increasing the odds of a sharp directional move when volume returns.
Conclusion
Gold (XAU) may be in the quiet phase before the storm. With price holding steady near $3,344.8, despite declining CVD and modest volume, all signs point toward underlying strength. If momentum shifts and volume picks up, we could see XAU push back toward the $3,380–$3,400 zone in the short term.
For now, it’s a waiting game — but the clues suggest that when gold moves, it might move fast. Stay alert and watch the volume.
Peter Smith
