Gold D1: Will the Recovery Retest the Descending Trendline?GoldOANDA:XAUUSDDamonMarketDeskGold remains within a broader descending structure on the daily timeframe, despite recovering from the recent liquidity area around 3,900. The current rebound is improving short-term price action, but the larger trend has not yet confirmed a reversal. Market Structure — The Downtrend Remains in Focus The D1 chart continues to show a sequence of lower highs and lower lows beneath a descending trendline extending from the major peak around 5,500–5,600. Price has recovered from the recent downside liquidity area and is currently trading around 4,073. However, the market remains below the key Fibonacci references at 4,098 and 4,186. The descending trendline also continues to act as an important dynamic resistance. Key Zones — Levels That Matter - 4,250–4,300 — Sell Test Trendline: Major resistance confluence where a potential rejection could develop. - 4,098–4,186 — Fibonacci Resistance: Intermediate reference zone for assessing the strength of the current recovery. - Around 3,974 — Horizontal Support: An important level for maintaining the current recovery structure. - 3,900–3,920 — Liquidity Zone: Previous area of buying interest and the next downside reference. - Around 3,844 — Fibonacci 1.618: Further downside extension. - Around 3,432 — Fibonacci 2.618: A deeper extension reference if broader selling pressure persists. Primary Scenario — Recovery Into Trendline Resistance The primary scenario allows gold to extend its recovery toward the descending trendline and the 4,250–4,300 resistance area. At this confluence, I will be watching for rejection and the formation of another lower high. If sellers regain control and price breaks below the supporting structure, attention shifts toward 3,974, followed by the liquidity area around 3,900–3,920. A sustained break below these levels could expose the lower Fibonacci extensions at 3,844 and potentially 3,432. The recovery does not necessarily need to reach major trendline resistance before bearish pressure returns. Alternative Scenario — Buyers Challenge the Downtrend A sustained reclaim of 4,098–4,186 would improve the recovery outlook. However, the broader bearish structure would only face a more meaningful challenge if buyers break above the descending trendline and the 4,250–4,300 resistance zone, followed by a successful retest. If that happens, the upper Fibonacci reference around 4,510 becomes relevant. What I'm Watching Next The immediate focus is how price behaves around 3,974 and whether buyers can maintain the recovery. Beyond that, the key question is whether gold can approach the descending trendline or establish another lower high beneath it. A recovery can challenge the downtrend, but only a confirmed structural breakout can change the broader market outlook.