XAUUSD Technical Analysis: Correction Ends, Bullish Wave Begins
XAUUSD Technical Analysis: Correction Ends, Bullish Wave Begins
In the 4-hour timeframe, XAUUSD (Gold) has completed its corrective pattern (2) and is now initiating a new impulse wave (3) within an established upward channel. Traders who monitor relevant market news can gain a clearer perspective on current price fluctuations and volatility.
Elliott Wave Structure in Gold
Gold continues to trade within a global bullish channel. Following the completion of an impulsive wave (3) and a deep correction in wave (4), the market formed a local bullish wave (1). The subsequent correction (2) developed into a classic three-wave (A)-(B)-(C) structure. The bearish wave (C) manifested as an Ending Diagonal with an internal 3-3-3-3-3 structure. Notably, wave 5 within (C) successfully touched the lower boundary of the bullish channel and a key demand zone, effectively establishing the floor for wave (2).
Technical Factors and Chart Convergence
The combination of the rising channel and support levels significantly increases the potential for a price reversal. According to professional technical analysis reports, the wedge or diagonal pattern completed at the end of wave (C) typically leads to a powerful breakout in the direction of the main trend. Observing a bullish reaction from the demand zone on the 4-hour chart provides a strong signal for the commencement of wave (3).
Trading Plan and Buying Strategy
Our primary scenario focuses on opening Long positions to ride the continuation of the trend. Traders should consider the following targets for effective trade management:
- Target 1 (TP1): Breakout of the local high of wave (1).
- Target 2 (TP2): Retesting and breaking the previous peak of wave (3).
- Target 3 (TP3): Reaching the upper boundary of the bullish channel in the wave (5) range.
For more detailed updates, please refer to our official news source. Please note that if a candle closes below the low of wave (2), the bullish scenario becomes invalid.
Frequently Asked Questions (FAQ)
How is the current technical status of Gold (XAUUSD) evaluated on the 4-hour timeframe?
On the 4-hour timeframe, after completing a three-wave (A-B-C) correction in the form of wave (2), Gold is beginning a new impulse wave (3) within a bullish channel.
What does the Ending Diagonal pattern in wave (C) signal to traders?
The formation of an Ending Diagonal at the end of wave (C), touching the lower channel boundary and a key demand zone, typically indicates the end of a correction and high potential for a powerful bullish breakout.
What are the price targets for the Long strategy in Gold?
We have identified three targets: TP1 at the local high of wave (1), TP2 at the previous peak of wave (3), and TP3 at the upper boundary of the bullish channel.
When does the bullish scenario for Gold become invalidated?
The bullish scenario remains valid as long as the upward channel holds. If the price closes a candle body below the low of wave (2), the analysis is invalidated, and the trend must be re-evaluated.
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