On November 5, gold prices surged strongly from a low of 3920 to around 4070, posting a single-day gain of 3.35%, the largest daily bullish candle since mid-August, and this rally fully erased all the losses from the previous three days in one sweep.
After yesterday's one-sided advance, the US session saw a period of choppy consolidation, with prices stuck below 4052 for an extended time in narrow fluctuation, waiting for a fresh round of news-driven stimulus. It was not until this morning that news emerged of further easing in geopolitical tensions, which caused bullish sentiment to erupt once again, and gold prices pushed higher once more, continuing the upward rhythm.
This round of gold's rally is mainly the result of a triple boost from politics, geopolitics, and the US dollar. After the US midterm election results were finalized yesterday, the market expects that large-scale fiscal expansion and tax cut policies will face difficulty in advancing, which in turn lowers expectations for US Treasury issuance, and Treasury yields have begun to weaken accordingly. At the same time, signals of easing in US-Iran tensions have emerged again, further cooling geopolitical risks, international oil prices have started to fall sharply, and inflationary pressure on the Fed has been further alleviated. Now, under the influence of multiple news factors and the resonance of multiple bullish drivers, gold prices are being driven to continue rapidly hitting new highs in the short term.
Based on the current market news flow, the approach now is simply to stay bullish on gold without hesitation, unless a bearish news catalyst for gold suddenly appears later, at which point we can stop being bullish and shift to focusing on range-bound repair.
From the perspective of short-term price action and trading rhythm, the immediate upside focus is on whether gold can break through the 4150 threshold. Once it successfully breaks above that level, there is potential to challenge the short-term strong resistance at 4175-4185. If it stabilizes above that zone again, bulls will then have the opportunity to target the 4200 mark. However, with bulls continuously pushing higher, short-term pullbacks under pressure will also present opportunities, so we can appropriately take light short positions on the short side, wait for a dip, and then look for suitable entry points to add longs. Of course, in a bullish trend, short positions must not be held for long periods. For now, just take small profits on shorts and wait for the opportunity to enter big long positions for larger gains.
For today's short-term gold trading levels, reference can be made as follows: 1. Gold is currently fluctuating and testing the upside 4150 threshold, so we can take a light short position for a quick trade, with downside support seen near 4120-4110. Be sure to set a stop loss on the short at 4155; if it breaks above 4155, do not hold it for long. 2. Going forward, buying on pullbacks remains the main approach. Now we need to see whether the downside pullback can once again provide support near 4110-4120, which would be a more suitable intraday level to continue adding longs. Set the long stop loss below at 4095, with targets looking at whether 4145-4150 can be broken; if it breaks further, then extend the target to new highs at 4175-4185. 3. With the market continuously moving higher, for now just focus on following the trend and staying bullish, but whether directly chasing longs or appropriately attempting shorts, we must always set stop losses promptly. After all, a single round of news-driven stimulus can trigger another large one-sided move, so no matter when we trade, we must understand that the core principle of trading is to use small stop losses to pursue large profits.
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