Gold Correction Turns into Buy Opportunity

Economic

Commodity

Summary:

XAU/USD is showing renewed buy interest after a significant pullback from record highs near $5,594, stabilizing around $5,170–$5,230....

BUY XAUUSD

Close Time

CLOSED

5169.05

Entry Price

5350.00

5050.00

4894.49 -481.82 -8.96%

1190.5

Pips

Loss

5050.00

5049.72

Exit Price

5169.05

Entry Price

5350.00

Market Overview

Gold has experienced exceptional volatility this month with an extraordinary rally to all-time highs above $5,590, driven by macroeconomic instability, deep USD weakness and intense safe-haven flows. After hitting peak levels, a meaningful correction took hold as traders booked profits and the US dollar found temporary strength, pulling XAU back toward the $5,100–$5,200 area. Recent price action shows that this pullback is not yet a broader reversal but rather a consolidation within the larger upward trend, creating a tactical buy-on-dip opportunity on the M15 timeframe. Macro factors such as continued geopolitical uncertainties and expectations for future Fed policy shifts support renewed demand for gold as a hedge.

Market Sentiment

Sentiment remains broadly bullish for gold despite short-term correction pressures. The recent sell-off reflects profit-taking after extreme overextension rather than a fundamental shift toward bearishness. Safe-haven demand persists as investors remain cautious about economic, inflation and geopolitical risks, keeping the broader narrative supportive of higher gold prices over time. With gold still holding significant gains from earlier in January, dip buyers are watching key support levels for re-entry as momentum stabilizes and oversold conditions on lower timeframes materialize.

Technical Analysis

Gold Correction Turns into Buy Opportunity_1

On M15 charts, after a sharp pullback from the record highs, price is finding buyers near dynamic support zones and previous short-term pivot levels. Indicators suggest that the recent decline may be completing its correction phase, and momentum oscillators (e.g., RSI turning up from oversold) are hinting at renewed bullish pressure. Consolidation around current levels near $5,170–$5,230 offers a structurally sound entry zone for a buy-on-dip trade, targeting the next swing highs while managing risk if the correction deepens further.

Trade Recommendation

Entry: 5170

Take Profit: 5350

Stop Loss: 5050

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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Manuel

Forex

Central Bank

Summary:

A bullish crossover appears imminent. If the histogram transitions into positive territory and the signal lines clear the neutral level, we could see a sustained bullish correction.

BUY EURCHF

EXP

TRADING

0.91583

Entry Price

0.92000

0.91300

0.91591 +0.00114 +0.12%

0.0

Pips

Flat

0.91300

Exit Price

0.91583

Entry Price

0.92000

The recent surge in the Euro's valuation has officially entered the radar of European Central Bank (ECB) policymakers, reigniting a critical debate regarding the impact of a persistently strong currency on the future path of monetary policy. A firm Euro could, over time, emerge as a complicating factor for the inflation outlook, thereby influencing the central bank's restrictive stance.

In this context, Martin Kocher, Governor of the Austrian Central Bank and a member of the ECB Governing Council, noted that a continuous appreciation of the Euro might eventually necessitate a monetary policy response. Kocher clarified that such a move would not involve direct intervention in the foreign exchange market, but rather an adjustment to address the indirect effects; a stronger Euro naturally exerts downward pressure on inflation, making it a pivotal variable for the ECB's decision-making process. Following these remarks, the Overnight Index Swaps (OIS) market reflected a slight uptick in easing expectations. Traders currently assign approximately a 26% probability to a rate cut at the September meeting, up from the previously estimated 16%. Despite this shift, the broader consensus remains that the ECB will hold its current posture at the upcoming meeting on February 4–5.

Simultaneously, the Swiss Franc (CHF) continues to exhibit relative stability, though it remains notably weak against its antipodean peers. This underperformance persists even after Swiss National Bank (SNB) President Martin Schlegel alerted markets to the possibility of negative inflation episodes in the short term. During his address at the World Economic Forum, Schlegel noted a high probability of inflation dipping into negative territory this year, suggesting that a temporary deflationary period would not pose a significant threat to the broader Swiss economy.

From a domestic perspective, market valuations continue to price in the risk of the SNB cutting interest rates back into negative territory in the coming months. This concern is underscored by a -1.8% year-over-year decline in the December Producer Price Index (PPI), which brings deflationary risks back to the forefront. While January’s CPI held at 0.1%, the trajectory remains fragile, especially when coupled with a weak Manufacturing PMI of 45.8. With the next SNB policy meeting not scheduled until March 19th, the Franc remains vulnerable to further downside if the current 0% policy rate is perceived as insufficient to combat cooling price dynamics. Fading Bearish Pressure And ECB Rhetoric Point To EURCHF Recovery_1

Fading Bearish Pressure And ECB Rhetoric Point To EURCHF Recovery_1

Technical Analysis

EUR/CHF appears to be establishing a local floor after staging a bullish rebound from the 0.9143 support zone. With the outlook for a strengthening Euro gaining traction, this level may represent the definitive local bottom. A bullish correction from this area currently seems highly probable.

On the 1-hour chart, the immediate upside targets are centered around the 100-period Moving Average at 0.9193 and the 200-period MA at 0.9235. Additionally, a significant horizontal resistance is located at 0.9196, which aligns closely with the 100-period MA, creating a high-probability "magnet" for the current recovery.

Our momentum analysis via the MACD reinforces this reversal thesis. Although the signal lines remain below the neutral zone, the histogram is printing progressively smaller bearish bars, indicating that downward momentum is rapidly exhausting. A bullish crossover appears imminent. If the histogram transitions into positive territory and the signal lines clear the neutral level, we could see a sustained bullish correction.

As long as the price maintains its integrity above the 0.9143 handle, long positions are favored. A technical "reset" of the MACD above the zero line would confirm the shift in control, paving the way for a test of the major moving average cluster.

Trading Recommendations

Trading direction: Buy

Entry price: 0.9157

Target price: 0.9200

Stop loss: 0.9130

Validity: Feb 11, 2026 15:00:00

Risk Warnings and Disclaimers

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Manuel

Forex

Central Bank

Summary:

This confluence of indicators suggests that the pair is gathering sufficient momentum to initiate a new bullish impulse.

BUY AUDCHF

EXP

TRADING

0.53620

Entry Price

0.54450

0.53200

0.53809 -0.00050 -0.09%

0.0

Pips

Flat

0.53200

Exit Price

0.53620

Entry Price

0.54450

In Australia, recent inflation figures have exceeded market forecasts, significantly intensifying expectations that the Reserve Bank of Australia (RBA) may be forced to pivot toward a more restrictive monetary policy stance. In December, the headline Consumer Price Index (CPI) recorded a monthly advancement of 1.0%, a sharp reversal from November's flat reading and comfortably above the 0.7% market consensus. On a year-over-year basis, inflation accelerated from 3.4% to 3.8%, also overshooting the estimated 3.6%.

Conversely, the trimmed-mean (core) inflation data presented a more nuanced picture. While the monthly core figure rose by 0.2% in December—aligning with forecasts but slowing from the prior month's 0.3%—the annual rate edged higher to 3.3%. This remains stubbornly above the RBA's target range of 2%–3%. Furthermore, the NAB Business Confidence Survey for December reinforces the narrative for a tighter policy environment. Should the upcoming trimmed-mean CPI readings continue to exceed projections, the central bank will face mounting pressure to hike rates at its February meeting, a scenario that would likely provide substantial tailwinds for the Australian Dollar (AUD).

Across the globe, the Swiss Franc (CHF) continues to exhibit relative stability, though it remains notably weak against its antipodean peers. This underperformance persists even after Swiss National Bank (SNB) President Martin Schlegel alerted markets to the possibility of negative inflation episodes in the short term. During his address at the World Economic Forum, Schlegel noted a high probability of inflation dipping into negative territory this year, though he emphasized that a few months of deflationary pressure would not pose a significant threat to the broader economy.

From a domestic macroeconomic perspective, market valuations continue to reflect the risk of the SNB cutting interest rates below zero in the coming months. This concern is bolstered by a -1.8% year-over-year decline in the December Producer Price Index (PPI), which brings deflationary risks back into focus. While January's CPI held at 0.1%, confirming that headline inflation remains positive, the current trajectory is undeniably fragile. Combined with a weak Manufacturing PMI of 45.8, the Swiss economy continues to face persistent structural obstacles. With the next SNB policy meeting not scheduled until March 19th, the Franc remains susceptible to further downside if the current 0% policy rate is perceived as insufficient to combat cooling price dynamics. Resilient Technical Structure Points Toward Potential AUDCHF Breakout_1

Resilient Technical Structure Points Toward Potential AUDCHF Breakout_1

Technical Analysis

AUD/CHF remains entrenched in a definitive primary uptrend. The pair recently experienced a minor corrective phase after encountering a "Double Top" rejection at the 0.5430 level. However, the price has found a solid floor upon approaching the 100 and 200-period Moving Averages on the 4-hour chart, situated at 0.5350 and 0.5321, respectively.

This technical foundation is further reinforced by a significant horizontal support level at 0.5362. This confluence of indicators suggests that the pair is gathering sufficient momentum to initiate a new bullish impulse. A successful defense of this "Value Area" could finally provide the strength needed to breach the recent resistance and target the 0.5445 zone, which aligns with the 0.618 Fibonacci expansion—a primary area of interest for a long-term breakout.

Our momentum analysis via the MACD confirms that the broader trend remains bullish, with the signal lines comfortably situated above the neutral zone. While the histogram is currently printing smaller bullish bars—suggesting a temporary consolidation or a shallow retest of the 100-period MA—the underlying structural bias remains positive.

As long as the pair holds above this key support cluster, we favor long positions. A technical "reset" of the histogram near the zero line would offer a high-probability entry signal for a trend continuation toward recent highs and beyond.

Trading Recommendations

Trading direction: Buy

Entry price: 0.5362

Target price: 0.5445

Stop loss: 0.5320

Validity: Feb 11, 2026 15:00:00

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Summary:

EUR/USD rises near 1.1980 as US Dollar weakness persists amid Trump’s Fed uncertainty, while market eyes Eurozone consumer data and US jobless claims. Traders brace for volatility ahead of economic releases and policy signals.

BUY EURUSD

Close Time

CLOSED

1.19603

Entry Price

1.22000

1.19000

1.18491 -0.01211 -1.01%

60.3

Pips

Loss

1.19000

Exit Price

1.19603

Entry Price

1.22000

The EUR/USD pair traded on a positive footing near 1.1980 in early European session trade on Thursday, bolstered by broad US Dollar (USD) weakness and ongoing uncertainty surrounding US economic policy. Investors are navigating a complex backdrop, with the Eurozone set to release Consumer Confidence data later in the day, while the US reports Initial Jobless Claims, Nonfarm Productivity, and Unit Labor Costs for the third quarter.

The Greenback’s retreat continues to reflect market caution over US President Donald Trump’s policy unpredictability and the independence of the Federal Reserve (Fed), which has fueled gains in major USD pairs. On Tuesday, Trump signaled that he would soon announce his pick for the next Fed Chair, adding that he expects interest rates to drop significantly once a new chair is installed. These remarks have added to market speculation that the Fed’s policy trajectory could shift abruptly under political influence, contributing to the Dollar’s soft tone.

Despite these political pressures, the Federal Reserve opted to leave its benchmark rate unchanged at 3.50%-3.75% during its January policy meeting on Wednesday. Fed Chair Jerome Powell emphasized in the subsequent press conference that while economic activity appears to have improved since the last gathering, signs of labor market cooling remain. Powell’s remarks painted a cautiously balanced outlook, noting stabilization in employment alongside slowing wage pressures, suggesting that the central bank may take a measured approach to future rate adjustments.

Fed officials further signaled that rate reductions are not imminent, with markets largely pricing in a potential adjustment no earlier than June. This hawkish-hold stance may temper further USD losses in the near term, though investor attention remains fixed on policy clarity and the implications of any political intervention in the Fed’s decision-making process.

Across the Atlantic, the Eurozone continues to maintain steady growth momentum, even amid muted inflation pressures. Economists widely expect the European Central Bank (ECB) to hold rates steady at its February meeting, and the central bank has indicated that current rates are in a “good place” to support medium-term price stability. This dovish-but-stable tone, coupled with USD fragility, underpins the EUR’s resilience against its American counterpart.

Technical and sentiment factors are also shaping market dynamics. The US Dollar Index (DXY), which tracks the USD against six major currencies, is holding near 96.38, showing modest stability but lacking the strength to offset Euro gains. Traders are closely monitoring upcoming US data, including weekly jobless claims, Q3 Nonfarm Productivity, and Unit Labor Costs, for clues on underlying economic momentum and potential shifts in Fed policy expectations.

Market participants face a delicate balancing act. On one hand, the Euro remains supported by the USD’s political and policy-related vulnerabilities; on the other, the Fed’s deliberate pace and ECB’s steady guidance suggest that both central banks are in a holding pattern. This environment favors a range-bound EUR/USD, with price action likely to remain sensitive to headlines around Fed leadership and economic surprises from either side of the Atlantic.

Analysts suggest that any hawkish signals from the Fed—or clarification regarding the independence of the central bank—could temporarily bolster the USD and weigh on EUR/USD. Conversely, continued political uncertainty in Washington and firm European data may keep the pair elevated toward 1.2000–1.2050 in the near term. Traders are advised to track both economic releases and geopolitical developments closely, as these remain the primary drivers of intraday volatility.

Technical Analysis

From a technical perspective, EUR/USD remains positioned within a broader bullish continuation structure on the 4-hour chart. Following a strong impulsive rally from the 1.1600 region, price has transitioned into a controlled consolidation phase, forming a descending channel / bullish flag just beneath the 1.2000 psychological level. This type of corrective structure typically reflects profit-taking rather than trend exhaustion, and it preserves the integrity of the prevailing uptrend.

Price is currently oscillating around the 1.1950–1.1970 zone, which has emerged as an important short-term equilibrium area. This zone aligns with prior breakout structure and is acting as key demand, repeatedly absorbing downside attempts. As long as price holds above the 1.1920–1.1900 support band, the bullish market structure remains intact. A decisive 4-hour close below this region would signal a breakdown from the flag and open the door for a deeper corrective move toward 1.1850, followed by 1.1800, where previous consolidation and institutional demand are located.

On the upside, the 1.2000 round number remains the immediate cap. This level has repeatedly rejected price and coincides with the upper boundary of the corrective channel. A clean breakout and sustained hold above 1.2000 would confirm continuation and likely trigger momentum-driven buying. In that scenario, upside targets extend toward the 1.2050–1.2100 zone, with the broader bullish objective resting near the 1.2200 resistance area, highlighted on the chart as a higher-timeframe supply zone.

Overall, price action suggests compression rather than distribution. The sequence of higher lows, shallow pullbacks, and tightening range favors an upside resolution, provided key structural support remains defended. Until a breakdown occurs, the bias remains bullish with consolidation rather than reversal.

TRADE RECOMMENDATION

BUY EUR/USD

ENTRY PRICE: 1.1960

STOP LOSS: 1.1900

TAKE PROFIT: 1.2200

Risk Warnings and Disclaimers

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Eva Chen

Forex

Summary:

GBPUSD is consolidating near multi-year highs, while the US dollar remains under pressure amid “sell-America” trade sentiment, the Fed’s policy outlook, and elevated political uncertainty. On the technical front, a failed short-term inverse head-and-shoulders pattern signals rising pullback risk at elevated levels.

SELL GBPUSD

EXP

TRADING

1.38081

Entry Price

1.35000

1.39990

1.36835 -0.01258 -0.91%

0.0

Pips

Flat

1.35000

Exit Price

1.38081

Entry Price

1.39990

Fundamentals

GBPUSD hovered around 1.3834 on Thursday, close to its highest level since August 2021. While sterling itself lacks fresh bullish catalysts, rising volatility in the US dollar has continued to provide support for the pair.

The recent weakness in the dollar mainly reflects a market repricing of US policy and capital flows. US Treasury Secretary Scott Bessent stated that Washington has no plans to intervene in the FX market by selling the Japanese yen. The remark was interpreted as a restrained stance on exchange-rate issues, reinforcing existing “sell-America” trade sentiment and weighing further on the dollar.

Meanwhile, the Fed left interest rates unchanged at its latest meeting and slightly upgraded its economic outlook, reinforcing expectations of an extended rate pause. However, markets have not fully embraced a hawkish interpretation. Investors widely believe that if former President Trump were to replace Jerome Powell with a more dovish Fed chair in the future, US monetary policy could still re-enter an easing cycle. This medium- to long-term uncertainty continues to act as a potential drag on the dollar.

With the Fed temporarily on hold, market attention has shifted to the Bank of England (BoE). Markets broadly expect the BoE to keep its benchmark rate unchanged at 3.75% at next week’s meeting. This expectation is supported by recent UK inflation data — December inflation rose to 3.4%, while retail sales figures pointed to renewed price pressures, leaving the BoE with little room to pivot decisively toward easing in the near term.

Looking ahead, while sterling fundamentals have not deteriorated materially, the prior rapid rally has significantly increased short-term correction risks. Combined with signals from short-cycle price structures, GBPUSD appears more likely to be transitioning from high-level consolidation into a pullback phase. If the adjustment extends, the pair may retreat toward the 1.3500 area, which marks the base of the previous upswing.

Bulls Still in Control, but Upside Safety Margin Has Narrowed Significantly_1

Technical Analysis

From a technical perspective, intraday price action in GBPUSD is broadly neutral. However, below the interim high at 1.3867, signs of a failed short-term inverse head-and-shoulders pattern have emerged, suggesting that bullish momentum is fading quickly and downside risks are building.

On the downside, initial support is located at 1.3641. A break below this level could open the door for a deeper pullback toward the 1.3500 zone, corresponding to the key origin of the prior rally.

Conversely, if 1.3641 holds and caps downside pressure, bulls may attempt to retest resistance at 1.3901. A decisive break above 1.3901 would shift the medium-term target higher toward the 1.4246–1.4248 area, near a major structural resistance zone.

Overall, based on current structure and momentum, we lean toward a scenario in which a break below 1.3641 triggers a deeper corrective move.

Trade Recommendations

Trade Direction: Sell

Entry Price: 1.3825

Target Price: 1.3500

Stop Loss: 1.3999

Valid Until: February 24, 2026 23:55:00

Support: 1.3788 / 1.3749 / 1.3641

Resistance: 1.3867 / 1.3893 / 1.3916

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Summary:

AUD/USD rises near 0.7050 after strong Australian inflation data boosts expectations of an RBA rate hike, though a steadier US Dollar limits the pair’s upside.

BUY AUDUSD

Close Time

CLOSED

0.70600

Entry Price

0.72000

0.70150

0.69616 -0.00873 -1.24%

45.0

Pips

Loss

0.70150

0.70148

Exit Price

0.70600

Entry Price

0.72000

The Australian Dollar extended its advance against the US Dollar on Thursday, with AUD/USD trading near 0.7050, up roughly 0.25% on the session, as investors reacted to firmer-than-expected domestic inflation data that has significantly shifted expectations for Reserve Bank of Australia policy.

The move highlights how sensitive currency markets remain to even modest shifts in rate outlooks. In Australia’s case, the latest price data has reinforced the view that inflation pressures are proving more persistent than policymakers had hoped, raising the probability that the RBA may be forced to resume tightening sooner rather than later.

According to market pricing reflected in interest rate derivatives and ASX’s RBA Rate Tracker, traders now assign better than a 70% probability of a 25-basis-point rate increase at the next central bank meeting. That represents a sharp repricing compared to just a few weeks ago, when investors were leaning toward an extended pause. The turnaround in expectations has given the Australian Dollar a renewed yield advantage, improving its appeal relative to other major currencies where central banks are either pausing or edging toward easing.

The underlying inflation report showed accelerating price pressures across both headline and core measures, suggesting that disinflation progress has stalled. Importantly, cost pressures were not confined to volatile components. Instead, price gains were broad-based, reflecting resilience in domestic demand and continued strength in services inflation — a combination that complicates the policy outlook for the RBA.

Adding to the concern, the latest quarterly trade price data revealed rising export and import prices, signaling that external cost pressures remain in play. This dynamic increases the risk that inflation could stay elevated for longer, even if global goods prices continue to normalize. For the central bank, that creates a difficult balancing act: tightening policy further could weigh on already stretched households, but failing to act risks allowing inflation expectations to become unanchored.

In my view, the RBA is edging closer to a point where it has little room to rely solely on rhetoric. With inflation still clearly above target and economic activity holding up better than many expected, policymakers may prefer to deliver at least one additional hike to reinforce their inflation-fighting credibility. That possibility is now being reflected in currency markets, where the Aussie has regained upward traction.

Still, gains in AUD/USD have been tempered by a steadier US Dollar backdrop. The Greenback found renewed footing after US Treasury Secretary Scott Bessent reiterated Washington’s long-standing commitment to a strong dollar policy, helping to calm markets after a recent wave of selling pressure. His comments followed remarks from President Donald Trump earlier in the week that appeared to downplay the currency’s slide, which had pushed the Dollar Index toward multi-year lows.

Meanwhile, the Federal Reserve’s latest policy decision offered little immediate directional bias but reinforced a “higher-for-longer” narrative. The Fed left interest rates unchanged, with Chair Jerome Powell emphasizing that future decisions will remain data-dependent. With US growth still solid and inflation proving sticky, traders have scaled back expectations for rapid rate cuts, lending additional support to US yields and, by extension, the Dollar.

The US Dollar Index (DXY) is holding firm near 96.38, reflecting this stabilization. Upcoming US data — including weekly Initial Jobless Claims, Nonfarm Productivity, and Unit Labor Costs — could influence short-term rate expectations and inject volatility into AUD/USD. Strong US labor or cost data would likely bolster the Greenback, while softer readings could allow the Aussie to extend its recovery.

For now, however, the dominant driver remains the Australian side of the equation. As long as incoming data continues to point toward persistent inflation and markets maintain confidence in further RBA action, dips in AUD/USD may attract buyers. That said, the pair’s upside could remain gradual rather than explosive, given the counterbalance of a still-resilient US Dollar and lingering uncertainty over the global growth outlook.

Technical Analysis

From a technical perspective, AUD/USD remains firmly embedded in a well-defined bullish structure on the 2-hour chart. Price action continues to respect a rising trendline that has guided the advance since the mid-January lows, with the pair consistently printing higher highs and higher lows. The latest pullback has brought the pair back toward this ascending trendline, which is now converging with the 0.7050–0.7060 area and acting as key dynamic support. So far, buyers have defended this zone, keeping the broader uptrend intact.

Recent price behavior suggests consolidation rather than reversal. The pair stalled just ahead of the 0.7100 handle, a near-term horizontal resistance level that has capped multiple upside attempts. The pullback from this region has been relatively shallow and overlapping, typical of a corrective move within an ongoing uptrend rather than the start of a bearish phase. As long as price remains above the rising trendline, dips are likely to be viewed as buying opportunities.

A decisive break and sustained move above 0.7100 would confirm bullish continuation and signal that buyers have regained full control. In that scenario, the next upside targets come in near 0.7150, followed by the 0.7200 psychological level. The projected move illustrated on the chart suggests potential for an extension toward the 0.7280–0.7300 zone if bullish momentum accelerates and the trend structure remains orderly.

On the downside, the ascending trendline is the critical technical level to watch. A clear 2-hour close below 0.7045–0.7050 would represent a short-term structural shift, breaking the sequence of higher lows and opening the door for a deeper corrective pullback. Initial downside targets would then be seen near the 0.7000 psychological handle, with further weakness exposing the 0.6950 region, where prior consolidation and demand emerged.

Overall, AUD/USD retains a constructive technical bias while trading above rising trendline support. The broader trend remains bullish, with consolidation below 0.7100 appearing to be a pause within the uptrend rather than a topping formation.

TRADE RECOMMENDATION

BUY AUD/USD

ENTRY PRICE: 0.7060

STOP LOSS: 0.7015

TAKE PROFIT: 0.7200

Risk Warnings and Disclaimers

Add to Favorites

Warren Takunda

Traders' Opinions

Summary:

Gold prices extended their record rally as geopolitical tensions, US dollar weakness, and continued expectations of Federal Reserve rate cuts drove strong safe-haven inflows, with structural demand from central banks and investors reinforcing bullion’s advance.

BUY XAUUSD

Close Time

CLOSED

5540.00

Entry Price

5700.00

5470.00

4894.49 -481.82 -8.96%

700.0

Pips

Loss

5470.00

5469.95

Exit Price

5540.00

Entry Price

5700.00

Gold prices extended their extraordinary rally on Thursday, adding another leg to what has become one of the most powerful bullion advances in recent memory. The spot price of XAU/USD built on the prior session’s hefty gains — nearly 4% — and pushed toward fresh record highs, trading around $5,522 at the time of writing after an intraday peak near $5,598. The relentless upside has been fuelled by a potent mix of intensifying geopolitical tensions, broad weakness in the US Dollar and persistent expectations of easier monetary policy from the Federal Reserve.

The precious metal’s dramatic ascent underscores how markets are pricing an elevated risk premium for safe-haven assets amid renewed geopolitical risks. At the same time, underlying structural drivers — including robust physical demand and speculative inflows — are amplifying gold’s move. Traders, investors and central banks alike appear unwilling to step back from allocation to gold, even as traditional drivers such as inflation and real yields wane and wax unpredictably.

Heightened geopolitical frictions have emerged as a clear catalyst for bullion’s surge this week, particularly after reports suggesting that the United States is contemplating significant military action involving Iran. According to media accounts, senior US officials are considering a major strike — a scenario that, if realised, would mark a dramatic escalation in tensions across the Middle East. Whether or not a strike ultimately unfolds, the mere prospect has been enough to elevate gold’s safe-haven appeal.

Compounding this has been an aggressive rhetorical stance from Washington, with the US President reiterating stern warnings on social media about deteriorating timelines and increasingly severe consequences should Iran fail to negotiate over its nuclear programme. Markets have historically priced gold aggressively on even faint whiffs of conflict, and this episode appears no different.

This geopolitical risk premium is acting against the backdrop of an emboldened “debasement trade” narrative — the idea that the US Dollar will continue to weaken as a result of expansive fiscal and monetary policy approaches in the world’s largest economy. Gold, as the quintessential safe-haven and dollar hedge, has benefited disproportionately from that narrative taking hold across asset markets.

Indeed, the US Dollar Index (DXY), which measures the greenback against a basket of six major currencies, has struggled near four-year lows, hovering around the 96.3 area. Continued dollar fragility has enhanced the allure of gold as an alternative store of value. Comments from US Treasury Secretary Scott Bessent aimed at steadying markets by reiterating America’s long-run commitment to a strong dollar have offered only short-lived respite. Traders remain sceptical, in part because the tone coming from the White House has been at odds with traditional Federal Reserve principles.

On monetary policy, the Fed’s recent decision to hold interest rates in the 3.50%–3.75% range did little to alter market expectations. The central bank’s statement highlighted solid economic activity, moderating labour market dynamics and continued inflationary pressures — a mixed message that left traders focused squarely on future easing prospects rather than the current plateau. Futures markets still price in roughly two rate cuts this year, a projection that has underpinned gold’s advance by reducing the opportunity cost of holding non-yielding assets.

The backdrop of potential changes at the Fed’s helm is adding another layer of uncertainty. Treasury Secretary Bessent suggested that an announcement on the next Fed Chair could come within weeks, with names such as Rick Rieder, Christopher Waller and Kevin Warsh reportedly under consideration. Markets are keenly aware that a leadership shift could tilt the central bank’s stance. A perceived pivot toward more dovish settings would only deepen the current gold rally.

Beyond the immediate drivers of safety flows and monetary policy, structural fundamentals remain robust. The World Gold Council reported earlier this week that global gold demand in 2025 exceeded 5,000 tonnes for the first time on record — a milestone driven by exceptionally strong investment appetite. Central bank purchases were particularly robust, with 863 tonnes acquired during the year, while gold ETF holdings rose by 801 tonnes — the second-largest annual increase ever recorded. Bar and coin demand also climbed to a 12-year high, illustrating broad-based interest from both institutional and retail participants.

These figures suggest that gold’s ascent is not purely driven by short-term geopolitical or macroeconomic forces but is also rooted in rising allocations across portfolios and reserve holdings. Central banks emerging markets — most notably in Asia and the Middle East — have been diversifying reserves away from fiat currencies, favoring bullion as a long-term hedge against currency volatility and systemic risk.

Going into the weekend, traders are eyeing the US economic calendar for additional clues about the macro backdrop. Weekly Initial Jobless Claims data, along with productivity and labour cost readings, could influence rate expectations. However, given the dominant role that geopolitical headlines have assumed, traditional economic indicators may take a back seat in guiding market sentiment — at least in the near term.

Technical Analysis

From a technical perspective, gold remains in a broader intraday uptrend, but is currently undergoing a healthy consolidation phase after a sharp impulsive rally. On the 30-minute chart, price action shows a strong bullish leg that accelerated from the $5,300 region to above $5,550 before stalling near a key resistance band.

Prices are now fluctuating between the $5,490–$5,500 support zone and the $5,580–$5,600 resistance area, forming a short-term corrective structure that resembles a bullish flag / descending wedge within the context of a larger rising trendline. Importantly, price continues to respect the ascending trendline drawn from the recent swing low, which reinforces that the broader structure still favors the upside.

The $5,490–$5,500 zone is acting as immediate demand. This area aligns with a previous breakout level and has repeatedly attracted buyers during the latest pullbacks. As long as price holds above this band, the consolidation appears constructive rather than bearish. A decisive break below this support, however, would shift focus toward the next downside level near $5,260, where prior consolidation and breakout structure originated. A sustained move below $5,260 would mark a deeper correction and temporarily weaken the bullish market structure.

On the upside, bulls are watching for a sustained break above the $5,580–$5,600 resistance zone. This area capped the recent rally and represents the last supply barrier before price can expand into open territory again. A clean breakout above this region would confirm trend continuation and likely accelerate momentum toward the $5,700–$5,750 zone, in line with the projected upward path shown on the chart.

The current pullback is occurring with overlapping candles and reduced downside momentum, which typically signals consolidation rather than distribution. Structurally, this pause appears to be a digestion of gains following an overextended rally, allowing the trend to reset before a potential next leg higher.

Overall, the technical outlook remains bullish while price holds above $5,490, with the current structure favoring breakout continuation rather than reversal.