On Wednesday, August 20th, the gold market experienced an explosive rally. After a slight early morning pullback to $4,323, prices found support and began climbing. The upward momentum continued through the European session, and a breakout above $4,450 during the U.S. session triggered a powerful surge that peaked at $4,524. The session closed firmly near the highs at $4,522.8, marking a robust daily close with a gain of nearly $200 in a single day and a massive bullish candlestick on the daily chart—a remarkably strong performance.

The recent outlook has been unequivocally bullish, with the core strategy centered on buying dips and following breakouts higher. During the Asian session yesterday, the analyst advised maintaining a bullish stance above the $4,310 low. Prices bottomed out at $4,323 and rebounded as expected. Subsequently, the recommendation was to aggressively initiate long positions at any suitable low, with a stop-loss placed below $4,323. By the afternoon, a direct entry at $4,338 was advised, with prices bottoming at $4,343 before the surge began. The level of $4,406 was decisively breached, and the analyst emphasized that the bullish momentum would persist. After the critical $4,450 mark was broken, the rally intensified further.

It was stated that as long as gold holds above $4,310, the bulls maintain control. Crucially, once the intraday low is established during a pullback, one should not wait for a deeper retracement to enter. Instead, it is essential to actively position for longs using the day's low as a defensive stop. Following the breakout above $4,450, the daily chart closed with a strong, full-bodied bullish candle. This price action confirms that the bias for today remains firmly bullish, with expectations of continued upside potential. Immediate support is now located at the $4,470 overnight pullback low, followed by the $4,450 breakout level, which now serves as support. The plan for the Asian session is to buy dips at the $4,470 support area, with the immediate upside target being a test of the $4,527 high. A break above this level would warrant additional long positions on minor pullbacks above the $4,500 handle.

Where to start

For those looking to participate, the strategy is clear: maintain a bullish bias and use intraday pullbacks to initiate or add to long positions, with a defined stop-loss below the recent swing low. The market structure strongly favors the upside, and attempting to short this momentum is not recommended. The key is to manage risk effectively while capitalizing on the strong upward trend. As always, the market will provide opportunities; patience and discipline in execution are paramount. Please note that this analysis is for informational purposes only and does not constitute financial advice. All trading involves risk, and you should carefully consider your investment objectives and risk tolerance before making any decisions.