XAUUSD: Wave 5 decline nears trendline Buy Zone

Jun 8

Gold is still trading inside a descending channel, and the current structure shows price continuing lower within wave 5. From Kelly’s view, sellers are still controlling the short-term movement, but the market is now moving closer to a potential exhaustion area near the lower trendline.

The key idea is simple: gold may still complete one more downside leg first, but the better opportunity may come after wave 5 finishes near the trendline support.

⟡ Market structure

Price remains below the descending channel resistance and has rejected from the short-term sell zone around 4,300–4,320. This keeps the immediate structure bearish and supports the idea that wave 5 is still in progress.

The chart also shows a lower trendline buy area around 4,220–4,240. If price continues falling into this zone and starts to slow down, that area may become important for a possible corrective rebound.

For now, gold is still weak, but the lower channel zone is where sellers may begin to lose momentum.

➤ Key levels

◌ 4,300–4,320: short-term sell zone
◌ 4,340–4,350: stronger resistance and wave A sell zone
◌ 4,220–4,240: trendline buy zone and wave 5 completion area
◌ 4,423: higher recovery target if rebound develops
◌ Below 4,220: area where the buy setup weakens

⌁ Elliott Wave view

From an Elliott Wave perspective, gold appears to be developing the final part of a bearish 5-wave move inside the descending channel.

The current decline can still be counted as wave 5, and the projected ending area is near the lower trendline around 4,220–4,240. If price reaches this zone and prints a clear reversal candle, it may suggest that wave 5 is complete.

After that, the market may attempt an A-B-C corrective recovery, with the first important upside reference near 4,300–4,350 and a wider recovery possibility towards 4,423.

▸ Trading scenario

Preferred scenario: wait for price to complete wave 5 near the lower trendline, then observe for bullish confirmation.

Entry zone: 4,220–4,240 if a clear reversal candle appears
Stop loss: below 4,210 or below the confirmed reaction low
Take profit 1: 4,300
Take profit 2: 4,340–4,350
Take profit 3: 4,423 if the recovery expands

Alternative scenario: if gold breaks below 4,220 with strong momentum and fails to react, the wave 5 completion setup loses quality and the market may continue lower before forming a new base.

⌁ Kelly’s view

For Kelly, this is not a place to chase the downside aggressively. The trend is still bearish, but price is moving closer to the lower trendline where wave 5 may complete.

The cleaner plan is to wait for price to reach the 4,220–4,240 zone, then watch whether buyers create a valid reversal candle.

Gold is still falling inside wave 5.
But if the lower trendline holds, the next meaningful move may be a corrective rebound.

Share your view below.

Jul 9

Trade active

Elliott Wave has completed 5 waves.