Gold Next Move: Breakdown Before Breakout?

Gold’s current structure reflects a complex multi-phase market environment, where short-term bullish movements coexist with mid-term bearish expectations before a potential macro continuation.

1. Quarterly (3-Month) Structure

To understand where gold is going, we need to step back and start from the 3-month chart.

At the start of April, price moved just below the Q4 2025 high (4,549.86), establishing a mid-low at 4,509.97.

This behavior confirmed liquidity interaction below prior highs before continuation attempts.

However, the upside was capped at 4,900.84, aligning with the 25% level of the quarterly upper wick — a technical rejection zone.

The initial expectation for Q2 was a continuation toward 5,132.91 (50% of the upper wick), followed by a higher time frame rejection.

This rejection has now materialized on the monthly timeframe.

2. Monthly Compression

April closed as an inside candle. This is important — it signals compression, not direction.

This structure keeps both directional scenarios open:

• Bearish: Breakdown below 4,509.97
• Bullish: Breakout above 4,890.67

Such formations typically precede expansion phases.

3. Weekly Liquidity Dynamics

In early May, price tapped 4,496.34, marking a 50% retracement of the prior leg up.

But the more important signal lies in the long lower wick from March. It suggests that liquidity remains untested below.

Key technical levels:

• 4,389 → 25% of lower wick
• 4,298 → 50% of lower wick
• Near 4,312 → 2026 opening level

A previous attempt to reach lower liquidity failed, increasing the probability of a renewed downside move.

4. Daily Timeframe Behavior

Interestingly, while the weekly chart leans bearish, the daily chart suggests a short-term upside move.

At the end of April:

• Price entered an order block
• Strong bullish reaction followed

However, Friday’s session showed weakness:

• Price tested the weekly open
• Closed below the daily open

This suggests a potential liquidity grab before directional continuation.

5. Probable Scenario

The most coherent scenario based on current structure:

1. Short-term upward movement
2. Test of 4,748 (62% Fibonacci retracement)
3. Rejection at resistance
4. Return into the order block
5. Breakdown toward 4,298

6. Strategic Interpretation

This market is not trending cleanly — it is rotating through liquidity phases:

• Phase 1: Short-term bullish retracement
• Phase 2: Mid-term bearish continuation
• Phase 3: Macro bullish expansion

7. Key Levels Summary

• Resistance: 4,748 → 4,900
• Pivot zone: ~4,500
• Target liquidity: 4,298
• Expansion target: 5,132

Final Conclusion

Gold is likely to complete a corrective upward move before entering a deeper retracement phase.
The zone around 4,298 stands out as the most probable base for the next major bullish continuation.

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