Gold prices retreated under new selling pressure, with XAU/USD trading near $4,501 at the time of writing. The day’s weakness coincided with a notable position closure in the derivatives market that caught the attention of traders.
Unusual position closure on Hyperliquid
According to data shared by market monitoring platform S.A.N.T.A., a futures trader on the Hyperliquid platform closed out all their short positions on gold after executing hundreds of trades overnight. The positions were initially opened on May 29 and fully closed during the latest strategy cycle.
Despite closing out gold-related trades, the same investor decided to keep their long position on the cryptocurrency HYPE open. Data shows this position was established around $45.95 on May 18 and has since reached an unrealized profit of $1.07 million.
Mini glossary: Hyperliquid is a decentralized crypto derivatives platform specializing in perpetual contracts. The term “perps” refers to perpetual futures contracts with no set expiry. In such contracts, investors can take positions speculating on either rising or falling market prices.
The charts indicate that the closed short positions on gold were tactical and short-term in nature, while the open HYPE long position reflects a more long-term strategy.
According to analysts, the closure of gold short positions alone does not signal the start of a new uptrend. Instead, this move is seen as profit-taking after prices hit the lower range, concluding the downside trade.
Key price band closely monitored by analysts
A 15-minute chart analysis from JMH House of Analysis highlighted that the fifth wave peaked at $4,595, right at the 1.618 Fibonacci retracement level. The report notes that Wave A is forming within the $4,490 to $4,510 price range.
The study also marks $4,546 as a critical level for a Wave B correction, and $4,456 as a downside target for Wave C. These markers place gold in what analysts describe as a decision zone following the most recent drop.
A reversal from the $4,490 to $4,510 band could propel gold prices back to $4,546. Conversely, a firm break below this range could lead to deeper selling pressure down to $4,456, according to expert commentary.
Daily indicators show ongoing weakness
TradingView data shows gold trading at $4,501.42, down $39.10 on the day. Recent price action has highlighted renewed dominance by sellers following the peak at $4,546.
The MACD indicator remains weak, with the signal line at minus 50.249, the trigger line at minus 47.628, and the histogram showing minus 2.621. Altogether, these readings point to persistent bearish momentum on the daily chart.
The Chaikin Money Flow is treading close to zero, indicating buyers have yet to establish control. Analysts caution that while gold may recover in the short term if it clears $4,546, a break below $4,489 would put $4,456 back on the radar as the next key support.
