XAUUSD (1H) – Bearish Breakdown Completed Target 1 (Now Testing Lower Range From Below)

Oct 29, 2025
3 min read

Pattern Type: Bearish range/structure break (lower trendline / lower boundary failure)
Asset: Gold (XAUUSD)
Timeframe: 1H
Trade Bias: Bearish move already played out into Target 1. Now in reaction phase, not chase phase.

🔑 Key Levels on Your Chart

X high: ~4,379.91
A: ~4,003.26
B: ~4,161.35
C: ~4,014.54
D: ~4,154.89
UPPER line / prior ceiling: ~4,150–4,160 region (where D topped out)
LOWER line / prior floor: ~4,000–4,020 region
- This is the “lower trendline breakout” level you marked
Retrace supply box: ~4,051.88 (23.6%) up to ~4,079.86 (50%)
- This is the light green box overhead on the right
Target 1 zone: ~3,926.67 (1.5 extension) down to ~3,850.07 (2.0 extension)
- Large green box below, where price reversed

📐 What Just Happened

Price built a broad corrective structure after the first dump from X → A.
It made a complex rebound (A→B→C→D) but failed to break above the UPPER resistance near ~4,150.
Then it rolled and finally snapped the LOWER boundary (~4,000–4,020).
- That breakdown is the key trigger: once we lost that lower band, momentum accelerated.
After the break, gold flushed directly into your measured extension box:
- 1.5 projection near ~3,926
- 2.0 projection near ~3,850
That zone was labeled “TARGET1,” and price hit it cleanly. That completes the initial short idea.

So: breakdown of the lower line → straight drive into Target 1 = textbook execution.

⚡️ Where We Are Now

After tagging Target 1, gold bounced aggressively.
We’re now trading back up into the old LOWER band (~4,000–4,020) from underneath.
- This is important: what used to be breakdown support is now acting like first resistance.
Above that sits the light green retrace box:
- 23.6% at ~4,051.88
- 50% at ~4,079.86
- That’s where late sellers may re-enter if the bounce continues.

This is exactly the zone where shorts look to reload after covering into Target 1.

🧠 How to Read This

Bears just proved they can push: they cracked structure, drove straight into projections, and hit Target 1 with momentum.
Now the market is in “profit-taking bounce” mode, not confirmed reversal mode.
The reaction off ~3,850–3,930 was strong because that was a full measured extension (1.5x / 2.0x). That’s where shorts bank and dip buyers step in.
But bulls haven’t actually flipped the structure unless we reclaim and hold above that 4,050–4,080 retrace block.

So bias is still bearish unless price breaks back above that 23.6–50% box.

📊 Next Potential Movements

Scenario 1: Bearish continuation (most natural):

Price stalls somewhere between the old LOWER band (~4,000–4,020) and the retrace box (~4,052–4,080).
We print rejection (wicks, lower highs), then roll back down.
In that case, you’d look for continuation back toward the Target 1 zone and, if momentum returns, possibly new lows beneath ~3,850.

Scenario 2: Deeper squeeze / correction:

Price powers through ~4,080 and starts holding above that 50% retrace.
That would tell you shorts are getting squeezed and we’re rotating back toward the UPPER resistance (~4,150+).
That’s where any “this was the low” narrative starts to become real.

🛡 Risk Management View

If you were short on the lower break and took profit in Target 1 (3,926 → 3,850), you’ve already done the job.
From here:
- You do not re-enter blindly in the middle of the bounce.
- The clean, high-quality re-entry for bears is:
  - a rejection under ~4,050–4,080 (that green retrace box), with clear lower-high structure,
  - tight stop just above that box,
  - goal = rotate back down.
If price rips through that 4,080 area and starts accepting higher, you step aside on the short idea and reassess from neutral.
Keep risk ≤1% per idea; after ~1R in your favor, you should already be thinking “move stop up / protect”.

🚀 Conclusion & Final Insight

Gold broke the lower line of the range and did exactly what it “should”: it accelerated into the measured extension box and hit Target 1 (the 1.5×/2.0 projection zone near 3,926–3,850). That part of the plan is complete.

Now we’re in the retest phase:

Price is bouncing back toward prior breakdown structure (~4,000–4,020) and possibly the 23.6–50% retracement block (~4,052–4,080).
If sellers cap it there, the next leg down can start and you’ve got a clean continuation short back toward lows.
If bulls reclaim that box, bears lose control and we start talking about a push back toward the UPPER band.