At the market open on Monday, 19 January, gold quotes (XAU/USD) formed a bullish gap and moved above the psychological level of $4,660, setting a new all-time high.

Today, 20 January, the market continues to show extremely bullish sentiment — for the first time ever, the price of gold has climbed to $4,720.

Why Is Gold Rising?

The main bullish driver is geopolitical tension. Following events in Venezuela, attention has shifted to the United States’ desire to acquire Greenland (through purchase or other means).

According to media reports:

→ Trump has threatened to impose tariffs on eight European countries that oppose his ambitions regarding Greenland. This further intensifies fears of a potential trade war between the US and Europe.

→ French President Emmanuel Macron has declined an invitation to join the Trump-proposed Gaza Peace Council and is also demonstrating opposition to Trump’s intentions concerning Greenland. In turn, German Chancellor Friedrich Merz stated that he is trying to persuade Macron to soften his response.

Technical Analysis of the XAU/USD Chart

Eight days ago, on 12 January, when analysing the gold chart, we:

→ constructed an ascending channel;
→ highlighted signs of market overbought conditions;
→ suggested that if a corrective scenario were to unfold, it would be unlikely to be deep.

Indeed, this scenario played out. On Friday, 16 January, the market pulled back to the $4,550 level, but judging by the long lower wick, bulls aggressively regained control around the body of the candle that formed at the opening of last week.

At the same time, as indicated by the arrows, we can observe similarities in the nature of the market open this week and last week: bullish gaps on wide candles breaking through previous resistance levels.

It cannot be ruled out that history may repeat itself — any pullback attempts (if they occur) may again prove unsuccessful, while the boundaries of the ascending channel continue to define the market’s trajectory.

Be prepared for volatility spikes as the traditional Davos Forum approaches (19–23 January), where a meeting between Trump and European leaders is expected.

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