During the Spring Festival period, gold prices have surged significantlyOn January 28th, the price of gold moved up from approximately $2,740 per ounce to a striking increase of $200 in less than a fortnight, with the price in renminbi reaching an unprecedented 690 yuan per gram.

The question looms: will gold continue its ascent? Is there a possibility that it may have peaked in the short term?

To understand the current rally, it's crucial to trace back to December 18th, when gold started surging from $2,784. Throughout this period, there were minor corrections, but they were merely brief pauses in a more extensive upward trajectoryThe real momentum observed now has been building for two months, culminating in a victory for bulls after fierce back-and-forth battles between bears and bulls.

The reasons for the gold rally are many and variedFactors include geopolitical risks, economic policies, and trade tariffsStill, these elements often serve as hindsight rationalizationsThe fundamental logic driving gold's value can be distilled to a singular concept: a crisis of trust in the dollarFor many investors, gold presents itself as the only reliable alternative anchor for value.

Unless trust in the U.S. dollar is entirely restored, a peak in gold prices seems prematureCurrent heights may appear lofty, especially when contrasted with past levels; however, when considering future projections, these prices could be seen as reasonableHistorical trends support this viewpoint, consistently validating that dips can occur even in extended bull markets.

Long-term, the prospect for gold remains robustly bullish; the $2,800 mark does not signal an all-time high, and neither does $2,900. As per my projections, I aim for an ultimate target of $3,318 this year, translating to around 768 to 770 yuan per gram

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It’s critical to acknowledge that price fluctuations are part of the journeyContinuous growth to that target is unrealistic without experiencing periodic corrections along the way.

Asserting that gold has reached its peak at this stage seems slightly hastyOver the last two years, anyone projecting a prolonged decline in gold has faced scrutiny and defeatThose who engaged in speculative benefit-seeking between fluctuations may not have secured the full advantages of this bull marketThe true winners have been those steadfast investors with unwavering conviction, capturing the wave of sentiment and market movement.

The employment data, CPI inflation statistics, and Federal Reserve monetary policies serve a singular purpose: reflecting the performance of the U.S. economyIn light of significant administrative reforms driven by figures like Musk, which seek to reduce government expenditures, there's an inevitable clash of interests that could heighten market unpredictabilityHistorical precedents, such as Kennedy's attempts to alter the Department of Defense, demonstrate the risks inherent in these transformative ambitions.

Throughout this period of growth—where gold rallied from $2,580 to $2,940, a notable increase of $360—a 100 to 150 dollar adjustment isn't unusualOveranalyzing these short-term fluctuations is not necessaryWhile day traders might obsess over immediate gains, long-term investors should concentrate on fundamental drivers rather than mere pricing outcomesPrice serves as a resultant factor of underlying influences; it’s vital to focus on the causes, the factors that have precipitated price movements.

Now, let’s discuss today's gold market dynamics:

Firstly, the Tuesday session saw gold prices accelerate in the middle of trading, adhering to a common market principle: rapid early surges are typically not sustainable

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When the markets opened with momentum, the chances of that trend lasting throughout the day diminished significantlyFor instance, the move from approximately $2,900 to $2,940 early yesterday morning constricted the potential for subsequent gains during the European and American trading sessionsSuch quick spikes warrant caution, as sustaining bullish momentum becomes increasingly difficultThose who were positioned according to market strategy and exited at the right time likely experienced notable shifts.

After the price hit $2,942, it subsequently dipped to $2,882, a drop of $60. Yet, following this decline, the price rebounded again to $2,909, indicating strong buying interest from bullsHowever, continuing into the morning, the market exhibited weakness, testing the support around the $2,880-82 rangeThe outcome of this testing phase will largely dictate short-term price directionA singular candlestick should not lead to a definitive conclusion about the end of gold's ascent; I refer to larger market trends.

Currently, the pivotal level resides at $2,880. If this support level fails, it could set off a sequence of declines—initially during Asian trading, followed by potential continuations into European and American sessionsIf this theory holds true, a bearish position could be justified before the next session; however, if prices stabilize above $2,880, traders should refrain from aggressively pursuing short positions, considering testing the support's effectiveness through short-term long plays instead.

Today, my outlook indicates a potential rebound for gold testing within the $2,887–85 range early onShould there be a decline into the afternoon, it is sensible to reassess positions before the American session, considering a reversal strategy that emphasizes short-term band trading, especially at price points around $2,905 and $2,915, focusing primarily on short segments rather than overall market direction.

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