Gold (XAUUSD) H1 Analysis: Swap Zone Rejection Keeps Bears In Control

Gold is showing signs of renewed weakness after rejecting a major swap zone resistance area on the H1 timeframe. The sharp decline from the highlighted resistance zone suggests that sellers remain active, increasing the probability that the current corrective structure may develop into a larger bearish sequence.

The market is now attempting to establish a new impulsive decline, with the projected Elliott Wave count pointing toward lower price levels in the near term.

XAUUSD H1 Technical Overview

The chart highlights a significant swap zone that previously acted as support before turning into resistance. Recent price action successfully retested this area but failed to break higher, triggering an aggressive bearish reaction.

The rejection occurred near the Fibonacci 261.8 extension zone, strengthening the importance of this resistance area and reinforcing the bearish outlook.

Elliott Wave Structure Suggests Further Downside

Following the rejection from resistance, Gold appears to have started a new bearish impulse sequence.

The current wave count indicates:

• Wave (i): Completed after the initial selloff.
• Wave (ii): Expected as a corrective rebound.
• Wave (iii): Projected as the strongest bearish leg.
• Wave (iv): Expected to form a temporary recovery phase.
• Wave (v): Expected to complete the broader downside cycle.

The projected path suggests that any short-term recovery could provide opportunities for sellers before the market resumes its decline.

Swap Zone Continues to Act as Resistance

One of the most important observations on the chart is the repeated rejection from the highlighted swap zone.

This area has acted as a major turning point multiple times in recent trading sessions. The latest failure to break above resistance confirms that sellers continue to defend this level aggressively.

As long as price remains below the swap zone, bearish momentum is likely to dominate.

Key XAUUSD Levels to Watch

Immediate resistance remains within the highlighted sell area near the swap zone.

A successful retest of this resistance region may provide confirmation for the next bearish wave.

The projected downside targets are located at the Fibonacci extension zones highlighted on the chart, where Wave (iii), Wave (iv), and ultimately Wave (v) could develop.

XAUUSD H1 Forecast

Gold remains vulnerable to additional downside pressure after rejecting a critical resistance area. The current Elliott Wave structure suggests that the market may only be in the early stages of a larger bearish sequence.

Traders should closely monitor any corrective rebound toward the sell zone. Failure to reclaim the swap zone could strengthen the bearish outlook and increase the likelihood of a move toward the lower Fibonacci target areas in the sessions ahead.