Mechanism for Bial's test
The acid-catalyzed condensation of furfural with orcinol to form structure 1 is explained here for Molisch's test: Clarification in the mechanism for Molisch&#39;s test for glucose. Ferric chloride is the oxidant of 1 (see 2 ----> 3). Acid catalyzes the ring closure of quinoid structure 3 to intermediate 4, which rearomatizes to 5 with loss of water. Direct cyclization of 2 with acid is unlikely because it would interrupt the aromaticity of one of the orcinol rings.