XAU/USD – Breakdown Structure SignalsXAU/USD – Breakdown Structure Signals Potential Deeper Correction on H1
Gold is showing early signs of a structural breakdown on the H1 timeframe after failing to sustain the recent bullish momentum. Price rejected strongly from the upper resistance zone and has since shifted into a corrective bearish structure. The current movement suggests that sellers may continue pushing price toward lower support levels.
1. Market Context
After forming a double rejection at the upper zone around 4208, XAU/USD broke below the short-term trendline and is now retesting the broken structure from below. This behavior often indicates that buyers are losing control while sellers begin to step in.
The loss of momentum is supported by the declining position of the DEMA, which now aligns as dynamic resistance.
2. Key Technical Levels
Resistance Zone
4200 – 4210
Major rejection area. Price failed to break higher twice, confirming strong seller presence.
Support Zones
4135 – 4140
First target zone if bearish continuation unfolds. This level acted as strong structure support earlier.
3980 – 4000
Major support and the next potential destination if selling pressure deepens.
3. Price Structure Analysis
A clear lower high has formed after the recent rejection.
Momentum shifted from bullish to bearish, shown by the aggressive decline and the corrective pullback.
The market is now forming a classic pullback setup into resistance before possible continuation downward.
The projected arrows on the chart align with a corrective bounce followed by a strong drop toward the deeper support.
4. Trading Scenarios
Primary: Bearish Continuation
Expect price to retest 4180 – 4190.
If price fails to close back above this zone, bearish pressure is likely to continue.
Downside targets:
4135 – 4140,
followed by 3980 – 4000 if the structure fully breaks.
Alternative: Bullish Recovery
Only valid if price closes above 4210 with strong momentum.
This would invalidate the current bearish structure and reopen the path toward recent highs.
5. Outlook Summary
XAU/USD is currently trading in a corrective bearish structure, with lower highs and weakening bullish momentum. Unless buyers reclaim the 4200 area, the market is likely to continue sliding toward the deeper support zones. Monitoring the reaction at the retest zone will be essential for confirming the next directional move.
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