On January 27, in our weekly review, we stated that gold would likely surge directly towards the 5000 mark upon Monday's opening. Yesterday, Monday, gold opened and rose sharply, breaking through $5000. While gold repeatedly hitting new highs is no longer news, ushering in a new era above $5000 is a first in human history. As long as Trump remains in office, the bull market is unlikely to end. His actions concerning Iran, Greenland, Canada, Cuba, and other issues are stirring up trouble, leading to frequent geopolitical conflicts. Gold, being the premier tactical safe-haven asset, is bound to be sought after.
Yesterday, we suggested going long with a defensive position around 5030. In the afternoon, after gold pulled back and found support at 5050, we recommended entering long positions directly. After breaking through 5100 and touching 5111, the price retreated rapidly. The 1-hour chart formed a long upper shadow candle, indicating significant selling pressure after the new high of 5111 was reached. However, after a second retreat to 5050 formed a small double bottom, we continued to advocate for long positions, targeting gains of over 30 points. Did you enter the trade? During the US session, gold tested highs but failed to break them, facing pressure to retreat. After breaking below the 5050 low, it experienced a follow-through decline.
The previous rally was too rapid. After an accelerated surge into a risk zone and a persistent failure to print new highs, a subsequent drop of around $100 should not be surprising, especially if the decline accelerates during the European or US sessions and breaks below key supports. At such times, avoid longing. What goes up easily can also come down easily; this is the watershed principle we consistently emphasize. However, a decline does not signify a trend reversal but rather a correction. Our medium-term bullish outlook remains fundamentally unchanged!
Analyzing gold at this point is straightforward: the outlook remains bullish. No matter how the price moves, the bias is upward, as we have consistently reiterated. For short-term longs, pay attention to entry levels and timing. Those holding long-term long positions from lower levels can remain confidently positioned. For intraday trading today, the key area is around yesterday's low near 4990. As long as the price holds above this zone, we maintain a bullish view. Additionally, the small double bottom level from yesterday's Asian/European session around 5050 is worth watching. Given the current high market volatility, specific entries should be timed based on real-time price action. Trading operations can reference going long around 5050, with a 10-point stop-loss, targeting gains of over 30 points.
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