FX.co ★ XAU/USD, GOLD

I observe that on Friday evening the market deliberately pushed a sharp spike down to the 4545.0 debt level, and I interpret this move as a classic liquidity grab designed to flush out weak buyers before the next phase of movement. I note that this maneuver successfully cleared long positions that were placed too close to the market, which in my view strengthened the structure for a renewed advance. I see that today’s Asian session opened with a gap above Monday’s call levels, and I understand this as a signal that the market is still inclined to price gold higher despite the recent shakeout. I recognize that after this gap, price action stalled and effectively froze, which I do not find surprising given the current market conditions. I take into account that today is Martin Luther King Day in the United States, and I know that reduced participation from US traders typically leads to lower liquidity and muted intraday volatility. I therefore assume that the lack of follow-through after the gap is more a function of the holiday than a sign of weakness in bullish sentiment. I also understand that the current Monday options do not expire today but instead roll over to next Monday, which in my opinion removes immediate expiration pressure from the market. I observe that Wednesday’s call options are positioned above the current spot price, and I interpret this as an indication that option market participants are still allowing room for upside expansion. I believe this option structure supports the idea that the broader bias remains bullish in the short term. I also consider the possibility that tomorrow the market could engineer another pullback, and I see this as a technically logical scenario rather than a bearish one. I expect that such a retracement could target the area of the highest traded volumes from the last impulsive rally, where strong acceptance previously occurred. I view that volume cluster as a natural magnet for price if the market seeks to rebalance after the gap. I think that a controlled dip into that high-volume zone would likely attract fresh buyers who missed the earlier move. I anticipate that if demand holds in that area, gold will then have the foundation to continue its upward movement with renewed strength.

I acknowledge that the recent price action in gold fully confirms the bullish scenario, and I see that the brief southern movement was merely a corrective pause rather than a trend reversal. I note that gold has resumed its upward trajectory with strong momentum, which suggests that buyers remain firmly in control of the market. I observe that today’s test of the 4687.50 resistance level, corresponding to the 7/8 stop and reversal on the daily timeframe, is a technically significant event that deserves close attention. I believe this level is acting as a key decision point where market participants are reassessing their positions. I understand that if the daily candle closes confidently above 4687.50, it will serve as a clear confirmation of a breakout and reinforce the dominance of bullish sentiment. I expect that such a close would invalidate most short-term bearish expectations and attract additional buyers who were previously waiting for confirmation. I think that in this breakout scenario, bulls will gain a psychological advantage, which could accelerate price movement due to breakout trading strategies and stop-loss triggering from short positions. I see the next logical upside target as the major round and historical resistance at 5000.00, marked as the 8/8 level, which holds enormous psychological significance for investors and institutions alike. I recognize that round numbers often act as magnets for price, but also as zones of heightened profit-taking and caution. I anticipate that as gold approaches the 5000.00 level, volatility will likely increase as long-term holders consider locking in profits and late buyers enter the market driven by fear of missing out. I am convinced that a strong corrective move to the south from that area is highly probable, not because the trend will end, but because markets rarely move through such psychological milestones without a meaningful retracement. I plan to carefully analyze the price reaction and volume behavior around 5000.00 to identify signs of exhaustion or distribution. I intend to use the structure formed near that level to estimate the depth and quality of the subsequent correction. I believe that the eventual pullback will provide valuable information about the underlying strength of the bullish trend and help define the next medium-term trading opportunities.