Spot gold entered a consolidation phase on Monday after a significant rebound in the previous trading session, currently trading near $4,987 per ounce. Last week's flash crash in U.S. stocks led to a cautious stance in the precious metals market. However, as technology stocks collectively staged a recovery on the final trading day, with companies like Micron and SanDisk briefly falling up to 6% before rebounding into positive territory, the gold market also saw a rebound on Friday.

This week, global markets will be affected by multiple holidays: U.S. markets are closed on Monday for Presidents' Day, and Canadian markets are shut for Family Day. Concurrently, the world's largest gold market is paused during the Chinese Spring Festival. In this environment of thin trading, even minor fund flows could trigger significant price swings in gold, potentially amplifying market volatility.

Last week, gold prices initially rose before falling, with the flash crash drawing significant attention. Overall, spot gold consolidated, posting a weekly gain of 1.06%, and at one point on Friday, it rose as much as 2.5%. However, the sharp decline on Thursday evening was notable—gold prices plummeted nearly 4% in less than an hour, touching a low near $4,900, before gradually rebounding, ultimately forming a short-term consolidation range between $4,880 and $5,120.

Regarding this sudden volatility, market speculation included potential leaks of CPI data, panic in the artificial intelligence sector, and profit warnings, though none were confirmed. Adam Button, Chief Currency Strategist, analyzed that the movement was more likely due to forced liquidations by large institutions, possibly a European fund selling heavily to meet margin calls. Such irrational liquidity shocks are magnified in thin market conditions.

A key recent market feature has been falling U.S. Treasury yields without a corresponding rise in the U.S. dollar index. This suggests that, without an increase in domestic U.S. funds, liquidity is being diverted to Treasuries, pressuring U.S. stocks. Alternatively, it could be said that the decline in U.S. stocks has driven safe-haven flows into Treasuries. Increased buying of Treasuries raises their prices and lowers their yields, pushing down the market's benchmark interest rates. This reduces the opportunity cost of holding gold, which was a significant factor behind last week's rebound. If Treasury yields do not rebound significantly, conditions remain favorable for further gold gains.

Technical charts and institutional views show clear divergence. Marc Chandler, Managing Director at Bannockburn Global Forex, believes that although gold has been consolidating recently, the probability of a long-term upward breakout remains. If gold can stabilize above the $5,000 level with reduced volatility, it may attract investors back. In contrast, Senior Market Analyst Alex Kuptsikevich holds a pessimistic view, pointing out that silver has hit consecutive multi-week lows and platinum is weakening simultaneously—signals that may indicate a bearish turn for the precious metals market. He expects gold to fall back to the $4,600-$4,700 range, with a break below this support potentially triggering accelerated selling by bulls. Senior Analyst Jim Wycoff provided key technical levels: bulls need to break through the strong resistance at $5,250 to open the path higher, while bears could trigger further declines if they push the price below $4,670. In the short term, the battle around the $5,100 resistance and $4,800 support levels is crucial.

Key data and risk events next week will influence gold's direction. Important economic data releases include the U.S. preliminary Q4 GDP (including the core PCE index), manufacturing PMI, and consumer confidence figures. The core PCE, a key inflation gauge for the Fed, could impact monetary policy expectations. The minutes from the Fed's January meeting will also reveal policymakers' discussions on the interest rate path, offering clues on future policy direction. Regarding risk events, a U.S. Supreme Court ruling on presidential tariff authority is expected next week; if it increases trade policy uncertainty, it could provide safe-haven support for gold. Progress in Iran negotiations and developments related to Fed Chair candidate Kevin Warsh are also seen as potential sources of volatility.

For gold traders, caution is paramount in thin holiday markets. Adam Button warned that the current high-volatility environment makes asset valuation difficult and dampens investor confidence. With expectations of seasonal weakness after the Spring Festival and a lack of clear short-term catalysts for gains, a neutral stance is advised until the direction becomes clearer. Michael Moore, Founder of Moore Analytics, provided specific trading references: in the short term, watch the key support at $4,806 and resistance at $4,857. If gold cannot reclaim key technical levels above these, the risk of a decline increases significantly. Amid a backdrop dense with data and events, controlling position sizes and setting strict stop-losses are crucial strategies for navigating market uncertainty.

Technical analysis indicates that spot gold has recently been oscillating around a pivot near $4,944, which is the 0.618 Fibonacci retracement level of the recent rally. Last week's sharp decline tested this support, and the price has since returned to trade within an ascending channel above it. As of 14:20 Beijing Time, spot gold is quoted at $4,666.53.