Gold (XAUUSD) – Daily Technical Analysis | October 31, 2026

Gold is showing significant bearish momentum after a sharp decline, but an interesting bullish AB=CD harmonic pattern has emerged near the recent low of $3,870.

Here are the key observations:

1. Bearish Market Structure

- ADX(14): 41.51, indicating a strong trend.
- −DI (17.77) remains significantly above +DI (4.73).
- Price is trading below the 50-day EMA ($4,113) and VWAP ($4,099).
- The weekly trend also remains bearish.

2. Potential Bullish Reversal
A bullish AB=CD pattern with a 1.618 extension has completed around $3,870.

The projected levels are:

- Target 1: $4,114
- Target 2: $4,266
- Pattern invalidation: $3,841

The proposed long setup offers an approximate risk/reward ratio of 1:3, with an additional protective stop at $3,797.

3. The Main Warning
A bearish marubozu candle has appeared at the pattern completion area, signalling strong selling pressure.

This makes immediate bullish confirmation particularly important.

My Outlook

Gold is approaching an interesting technical decision zone.

A sustained recovery above $4,000 could strengthen the bullish reversal scenario, with $4,114 as the first major target.

However, a daily close below $3,870 would significantly weaken the harmonic setup. A break below $3,797 would invalidate the proposed long trade.

For now, I consider this a potential countertrend opportunity rather than a confirmed trend reversal.

The key question: Is $3,870 the beginning of a recovery, or merely a temporary pause in the broader downtrend?

#Gold #XAUUSD #TechnicalAnalysis #Trading #HarmonicPatterns #Forex #MarketAnalysis