Yesterday, strongly stimulated by news, gold broke through its previous trading range, accumulating a gain of over $200 in a single day, exhibiting a highly impactful V-shaped reversal. The price dipped to a low of around 4065 before quickly rising to 4265, where it encountered significant selling pressure. After falling back to the key support level of 4225, buying pressure returned, pushing gold prices up again. Ultimately, the daily chart closed with a large, full-bodied bullish candle, indicating a significant release of bullish momentum and a clear strengthening of short-term market sentiment. Gold opened at around 4247 today, continuing yesterday's strong rebound. So far, it has reached a high of around 4304. The bulls are still in control. However, after the continuous rapid rise, the high-level volatility has increased significantly. Short-term profit-taking is gradually accumulating in the market, and we need to be wary of the risk of profit-taking after the surge and the risk of a technical correction.


From a technical perspective, gold has successfully broken out of its previous consolidation range, and the short-term trend has shifted from sideways to bullish. However, as prices continue to rise, hourly technical indicators have entered overbought territory, significantly increasing the risk of chasing the rally. It is possible that the Asian and European sessions will first see the price consolidate at high levels before waiting for a new direction to emerge. In terms of trading strategy, the key focus in the short term is whether the price can break through the 4304 level effectively. The key resistance area to watch is 4330-4350. Before this resistance is effectively broken, it's not recommended to blindly chase the rally at higher levels. Waiting patiently for a pullback and confirmation before entering a trading position is a more prudent approach. While we cannot predict or control sudden changes in news, we can improve the certainty of trading through technical analysis and risk management. In the trading process, stop loss is not terrible; what is terrible is losing confidence in executing the trading plan due to a single mistake. Recently, market sentiment has clearly leaned towards the bulls, so the operation is more inclined to buy on pullbacks. However, it must be emphasized again that you should not emotionally chase the rise, because chasing the high often means taking on greater risks. Furthermore, the non-farm payroll report for this week has not yet been released. If the data is stronger than market expectations, it may reinforce interest rate expectations, thereby putting downward pressure on the currently strong gold price. Therefore, given the significant uncertainty in the news environment, it is even more important to remain rational and manage positions carefully.

In summary, the recommended trading strategy for gold is to primarily buy on dips and secondarily sell on rallies. Key resistance levels to watch are the 4330-4350 area, while key support levels are the 4250-4230 area. Given the significantly increased market volatility, adhering to trading discipline, controlling position size, and patiently waiting for high-probability opportunities are the most important trading strategies in the current market.