XAUUSD is in a bullish sequence (impulse pattern) the pattern is valid as wave 3 is not the shortest wave and waves 1 and 4 not overlapped. Wave 5 is an Ending Contracting Diagonal pattern most likely we see a sell-off soon. Its gonna be hard to tell how deep the downside will last when considering trading the 1 and 4 hour but lower timeframe can offer good trading setup.
Waves 2 are not reliable like a flat correction a better way would obviously waiting for a the pullback then look for the 3rd wave on the bullish side the downside do has some opportunities on the lower timeframes.