Weekend external geopolitical risks have intensified, and gold, as a safe-haven asset, has once again gained popularity. Capital influx has driven intraday prices higher, touching 4420 at one point, but there are actually many technical traps behind this move.

From a fundamental perspective, the recent rally in gold is driven by solid factors. The global central bank gold-buying spree has continued unabated, with our central bank increasing holdings for 13 consecutive months, providing strong support for long-term gold prices. Additionally, market expectations of a Fed rate cut in 2026 remain intact, which directly lowers the holding costs of gold and fosters a bullish atmosphere.

However, the US dollar is also showing some movement. US economic data has performed relatively well, tempering expectations of rate cuts. US Treasury yields are also rising, diverting some funds that might have flowed into gold. Moreover, today’s focus is on the US December ISM Manufacturing PMI; if the data exceeds expectations, the dollar’s strength could continue to suppress gold price gains.

On the technical side, the daily bullish trend is clear, but the issue lies with the gap. The morning opened high, leaving a gap of over $30. Historical data shows that gaps driven by geopolitical events, while somewhat persistent, are about 68% likely to be filled within 30 trading days. In the short term, technical correction pressure remains significant.

Prices have already broken through previous dense high-level areas, with strong resistance at 4415-4420—this is both the current high zone and close to the key resistance level at 4430. Only a breakout here can further confirm the trend; otherwise, there is a risk of a pullback. Looking downward, 4335-4340 is a short-term support zone, with additional support at 4330-4300. If these levels are broken, it could trigger a deeper correction.

The technical indicators show some warning signs. Although MACD has not formed a death cross, the momentum at high levels is waning, and RSI is approaching overbought territory, indicating increased risk of chasing longs at high prices. On the 4-hour chart, short-term moving averages are arranged in a bullish formation, but the correction pressure from the gap is likely to cause oscillations and pullbacks.

From a trading perspective: For those looking to short, consider entering in batches around 4415-4420, with stop-loss above 4430, targeting 4350-4345. If broken, you can look further at 4335-4340. For longs, wait for a pullback to around 4335-4340 to enter in batches, with stop-loss below 4330, and initially target a rebound to 4390-4400. A breakout above that could lead to further gains toward the previous high at 4420.