XAU/USD: wave analysis

The pair is in a correction, a fall is possible.

On the daily chart, an upward trend forms as the third wave of the higher level iii of C of (B). Now, a local correction is developing as the fourth wave of the lower level (iv) of iii, within which the wave c of (iv) is forming. If the assumption is correct, the pair will fall to the levels of 1412.74–1378.45. In this scenario, critical stop loss level is 1516.80.

Main scenario

Short positions will become relevant during the correction, below the level of 1516.80 with the targets at 1412.74–1378.45. Implementation period: 5–7 days.

Alternative scenario

The breakout and the consolidation of the price above the level of 1516.80 will let the pair grow to the levels of 1585.56–1650.00.

Scenario

Timeframe Weekly
Recommendation SELL
Entry Point 1464.25
Take Profit 1412.74, 1378.45
Stop Loss 1516.80
Key Levels 1378.45, 1412.74, 1516.80, 1585.56, 1650.00

Alternative scenario

Recommendation BUY STOP
Entry Point 1516.85
Take Profit 1585.56, 1650.00
Stop Loss 1493.95
Key Levels 1378.45, 1412.74, 1516.80, 1585.56, 1650.00