Gold prices started the session with a shock and decline mode, breaking below the middle band of the Bollinger Bands and continuing downward. The lower band also moved lower in sync. It looks like a sharp fall, but a careful observation reveals that although this decline is rhythmic and continuous, it hasn't shown extreme conditions like massive crashes. In simple terms, this is a technical correction within a bullish trend, not a trend reversal.

**Bull-Bear Tug-of-War on the News Front**

This morning, the news impacting gold prices was quite mixed. On one hand, the US January New York Fed Manufacturing Index unexpectedly plummeted to -14.5, far below the market expectation of -10. This data indicates that the US manufacturing sector lacks sufficient recovery momentum, and market expectations for a rate cut by the Federal Reserve this year are rising again, which is a positive for gold. On the other hand, the US dollar index surged to around 105.2, mainly driven by a slight rebound in US Treasury yields, which put pressure on gold prices.

Interestingly, the geopolitical situation in the Middle East remains uncertain, and the Red Sea shipping crisis has not fully subsided. This keeps the premium for Asian spot gold above $5 per ounce. Buying on dips has been ongoing, objectively limiting the extent of gold’s decline.

**Technical Signals of an Upcoming Rebound**

From the hourly Bollinger Bands perspective, the current features are quite interesting — the bands are widening, with the middle and lower bands moving downward in sync, but the upper band is not weakening and continues to move upward. This indicates that the upward space above gold is not fully blocked, and bulls still have a technical basis for a rebound.

The continuous downward movement after breaking the middle band is essentially a technical retracement of the previous upward trend, not a directional reversal. As the lower band moves down with the price, it is effectively digesting short-term bearish momentum, avoiding oversold risks. Crucially, during the entire process of pulling the price down to the lower band, trading volume has remained relatively light, which fully demonstrates that the selling pressure from bears is not sustained.

**Trading Strategy**

It is more stable to establish long positions around 4575-4580. If the price continues to retrace to around 4562, consider adding to positions to lower the average cost. The upper targets are 4620 and 4650, with stop-loss placed below 4550.