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Gold enters key area – can wave C expand next week?
On the D1 time frame, gold is approaching a very sensitive stage where the previous bullish structure no longer holds the strong momentum seen in previous trends. Rather than continuing higher, prices appear to be reacting more clearly around key liquidity areas, while signs of a broader structural correction are starting to emerge.
It is worth noting that after a strong rebound, the market began to form a more corrective pattern and may develop into an ABC structure. Against this backdrop, next week could become a critical period in determining whether gold prices are simply experiencing a technical correction or are actually entering a deeper C-wave correction on the daily chart.
How does the fundamental backdrop affect gold?
This week, the dollar rose to a four-month high, reflecting the return of defensive flows in the market. In most cases, it tends to put downward pressure on gold.
But at the same time, the U.S. non-farm payrolls report unexpectedly lost 92,000 jobs in February, indicating that the labor market may be losing momentum. This adds uncertainty to the outlook for growth and monetary policy, continuing to support gold’s role as a defensive asset in the medium term.
In other words, gold is currently affected by two opposing forces:
Stronger dollar creates short-term pressure
Growing worries about economic slowdown and defensive demand continue to support gold prices at low levels
This tension is why the technical structure on the D1 time frame is even more important at this time.
D1 Chart Technology Outlook
1. Overall structure
From a broader perspective, gold prices are still in a correction phase after experiencing strong gains previously. Upward momentum has diminished, recovery attempts are no longer clean or sustainable, and selling pressure is starting to become more evident at higher levels.
The descending trendline above the price now acts as dynamic support, limiting the strength of rebound attempts. This suggests that buyers have yet to significantly regain control of the daily time frame.
2. Corrective wave structure
Based on the current configuration, the market may be forming an ABC correction:
Wave A represents the first significant decline from a high
Wave B is a correction stage, but it failed to fully recover the main resistance area.
Wave C may become the next lower stage, extending into deeper areas of demand
The key point here is that wave B reacted near diagonal resistance and failed to confirm a new upward continuation. This increases the likelihood that the market will continue to move toward a broader C wave.
3. Key liquidity areas
The 4,848 – 4,992 area is the most concerning liquidity area right now. This is not only an area of horizontal support, but also an area where a strong market reaction is likely to occur if prices continue to fall.
If this area fails to hold, the correction structure may expand more significantly, opening the way to 4,205, the area where the potential C wave has completed.
Below this, the area around 4,000 is the main daily demand area, as well as the higher timeframe demand area. If price eventually reaches this area, it will become a key area to watch for absorption and possible structural reactions.
important technical level
Near-term resistance:
Wave B retracement high and falling diagonal resistance line above
Key liquidity areas in the medium term:
4,848 – 4,992
Potential energy wave C completion area:
4,205
Main request block D1:
about 4,000
Next week’s trading scenario
Scenario 1: Wave C continues to expand
This remains the preferred scenario if price continues to reject the current retracement zone and fails to reclaim the overhead resistance structure.
In this case, the market may continue to fall towards 4,848 – 4,992 to test liquidity. If buying pressure in this area is not strong enough, Wave C could extend down to 4,205 and possibly even deeper to 4,000.
This scenario fits the current structure well, especially since the B-wave bounce was not strong enough to negate the prospects for a broader correction.
Scenario 2: Major liquidity brings technical rebound
If prices react positively around 4,848 – 4,992, gold prices may form a technical rebound towards the overhead resistance area.
However, at this point, any upward move should be considered a corrective bounce unless the price is able to break out of the major resistance structure and confirm a new uptrend on the D1 time frame.
In other words, gold needs to show more than a simple jump from support before the overall trend is considered bullish again.
What to pay attention to next week
The most important point now is not to predict definitively whether gold will rise or fall, but to monitor how the price reacts in key liquidity areas.
All focus next week will remain on the 4,848 – 4,992 area. This area will determine whether gold has just experienced a normal correction or is entering the final stages of a broader C-wave correction on the daily chart.
If price responses are weak, downward pressure could accelerate quickly. On the other hand, if there are clear signs of absorption and strong buying interest, the market may need more time to consolidate before choosing a new direction.
in conclusion
Overall, gold on the D1 time frame is showing signs of a more complete correction structure following the previous strong advance. With the U.S. dollar remaining strong in the short term and weak labor data adding uncertainty to the macro environment, gold has now entered a very sensitive area both fundamentally and technically.
For now, the possibility of gold developing a broader C-wave move next week remains the most important to monitor, especially if the rebound attempt continues below key resistance levels.
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