On August 26th, the bullish momentum in gold has been fully exhausted at elevated levels, and a sharp reversal correction is being flagged for Wednesday. Are you feeling both thrilled and anxious about this latest gold surge? A convergence of multiple bullish catalysts has driven prices violently higher, pushing straight to the 4700 mark. However, I must caution that such a rapid short-term surge is far from healthy. This rally has effectively consumed all the market's favorable news in advance.

With cooling rate hike expectations and a doubling in U.S. Treasury buyback scale, these dual positives have fueled the upward push. But have you considered the core questions? A pause in rate hikes seems certain, but will there actually be a rate cut? Is the expansion of Treasury buybacks a short-term adjustment or a long-term policy shift? Until these two key uncertainties are resolved, the current upward momentum lacks solid foundational support. In essence, it remains impossible to determine whether this strong rebound marks the start of a new bull market or merely a short-term recovery that will quickly fade after peaking.

Gold has never risen in an uninterrupted straight line. With weakening momentum at current highs and accumulating risks, a pullback could occur at any time. Once the rebound reaches its peak, seize opportunities to exit positions or reduce holdings decisively to avoid being trapped again by chasing extreme highs. Meanwhile, those who established long positions at lower levels can hold with confidence. This rally from the bottom has firmly established the bullish trend for gold in Q3 and Q4. As for whether it can break the 5200 mark next year and ignite a major bull run, the key lies in whether the long-term logic fully reverses.

There are two ultimate scenarios ahead. First, if the Federal Reserve initiates rate cuts, combined with escalating geopolitical risks in the Middle East, gold's safe-haven and inflation-hedging attributes could combine to drive prices past previous highs without issue. Second, if U.S. economic data improves and the Fed pivots back to a hawkish stance, this rebound could end abruptly, ushering in a new round of deep corrections. Therefore, at this stage, blindly chasing one-sided moves is absolutely not an option. Until the core resistance zone of 5000 to 5200 is broken, we must maintain caution and strictly control position sizes. Those with deep losses should seize opportunities to adjust positions, while low-position holders should stay the course to capture a potential second leg of the bull run.

Now, let's focus on Wednesday's critical strategy. The signals of gold topping out at high levels are becoming increasingly apparent, even though the dollar has yet to begin its bottom reversal. The short-term shift toward weakness and consolidation is steadily unfolding. Here is today's iron rule: it is far better to follow the trend and sell short at highs than to blindly chase long positions. Wednesday is likely to present a turning-point window, so we should patiently await directional clarity. With no major unexpected news on the fundamental front, this week's focus centers on three key items: crucial economic data, Middle East geopolitical developments, and Federal Reserve policy signals.

Finally, let's break down the technical picture, which is crystal clear. On the daily chart, a severe bearish divergence has emerged at high levels, with Tuesday closing as a textbook high-level doji candlestick — a blatant signal of fading bullish momentum. If Wednesday's daily candle closes bearish, it will directly form an evening star reversal pattern, officially kicking off a medium-term correction. Key support levels to watch below are 4660 and 4550. On the shorter timeframe, the market is clearly in high-level range-bound accumulation with distinct distribution characteristics. An intraday break below the 4600 short-term support is highly likely, with a subsequent move toward the 4550 low. Short and medium-term correction rhythms are perfectly aligned.

To summarize the key points: gold's long-term uptrend remains intact, and pullbacks to support levels will continue to offer buying opportunities. However, short-term risks at elevated levels are substantial, and Wednesday demands strict vigilance against a reversal correction. In terms of operations, absolutely avoid chasing highs; instead, consider tactical short positions at resistance for a pullback play. Today's precise range: resistance at 4670–4700 above, and support at 4620–4590 below. Within this range, favor selling rallies and buying dips while strictly managing position sizes, and wait patiently for a breakout or reversal signal.