XAUUSD Remains Vulnerable to Further Losses as Wave Five Structure Continues to Develop 

Market Overview

Gold (XAUUSD) continues to trade under bearish pressure on the H4 timeframe after failing to sustain its recent recovery. Current price action suggests that the market remains within a bearish impulsive structure, with the fifth wave still likely unfolding. 

Although short-term rebounds may occur, the broader trend continues to favor sellers as long as price remains below the nearby resistance zone. 

Technical Analysis

The Elliott Wave count indicates that waves (i), (ii), (iii), and (iv) have likely formed, while wave (v) is expected to complete the current bearish impulse. 

A temporary corrective bounce during wave (iv) may develop before selling pressure resumes, pushing the market toward the next downside objective. 

Meanwhile, the Awesome Oscillator (AO) is displaying bullish convergence, a condition that often precedes the formation of a bullish divergence. This suggests that while price may continue to print new lows, bearish momentum could gradually weaken as the decline approaches its final stage. 

Downside Target

If the current Elliott Wave structure remains valid, wave (v) is expected to extend toward the Fibonacci Extension 423.6% zone, which is highlighted as the primary downside target on the chart. 

This support area could become a key level where buyers begin to re-enter the market, increasing the probability of a medium-term reversal. 

Alternative Scenario

The bearish outlook would become less convincing if XAUUSD breaks above the wave (iv) high and establishes a series of higher highs. Such a move would suggest that the current bearish impulse has already completed and that a broader recovery phase may be underway. 

Conclusion

XAUUSD continues to maintain a bearish outlook, with the Elliott Wave structure suggesting that wave (v) has yet to complete. While short-term corrective rallies are possible, selling pressure is expected to resume before price reaches the Fibonacci Extension 423.6% target zone. Traders should also monitor the Awesome Oscillator closely, as a confirmed bullish divergence could provide an early indication that bearish momentum is fading and a larger trend reversal may be approaching.