XAUUSD Entering Final Wave of Correction

May 20

XAUUSD completed a corrective ABC structure after rejecting the major resistance zone near 4891. The broader structure still suggests a bullish higher-timeframe outlook, but the market is currently trapped inside a descending corrective channel.

Wave B completed at 4773, and the price is now extending lower in wave C of wave (2)/B. The internal structure of wave C is unfolding as a five-wave impulsive decline, which indicates that sellers are still active in the short-term trend.

Currently, the market is approaching the lower boundary of the parallel channel while wave (v) remains incomplete. Elliott wave projection and channel support indicate the potential reversal zone near 4380–4350.

After the completion of wave C and breakout of the descending structure, the next impulsive expansion may target the following levels: 4685, 4795, and 4850.

However, traders should avoid aggressive buying before confirmation, as corrective structures often produce false reversals near support zones.

Traders should keep two scenarios in mind:

1. The first bullish clue will appear after the breakout of wave 4 resistance at 4590, while the final bullish confirmation will be triggered after the breakout of the corrective channel.
2. Failure to hold the lower channel support may extend wave C into a deeper corrective structure before the next impulsive rally begins.

Tip: Corrective structures slowly exhaust momentum, while impulsive structures reclaim resistance with strength!

By BrightRally_Research

We will update further information soon.

May 24

Trade active

May 28

Trade closed: target reached

Reached 4386