During Wednesday's Asian and European trading sessions, precious metals markets extended their gains, with gold maintaining its strength amid safe-haven demand. Market attention focused on large-scale protests erupting across Iran, an event significantly heightening geopolitical uncertainty in the Middle East.

The U.S. has signaled potential intervention. On Tuesday, President Trump twice publicly told protesters opposing the Iranian government that “help is on the way,” which markets interpreted as a precursor to further U.S. government action. These statements have heightened market expectations of escalating tensions.

Against the backdrop of rising geopolitical risk premiums, risk asset sentiment has turned cautious, with capital flowing toward defensive and safe-haven assets. As a non-sovereign credit asset, gold has regained allocation demand, gaining relative strength against the U.S. dollar.

Historically, political turmoil in the Middle East has tended to provide medium-to-short-term support for gold prices while having a relatively limited impact on the U.S. dollar. As long as the situation remains unclear and the possibility of U.S. intervention persists, geopolitical risks will continue to be a key driver influencing gold prices.

Based on recent price momentum and geopolitical developments, the probability of spot gold breaking through US$5,000 per ounce this year now exceeds 30%. By 2026, gold will be well-positioned, supported by factors including a surge in global debt burdens, the trajectory of Federal Reserve policy, and potential volatility shocks.

We believe that the correlation between U.S. equities and bonds may remain positive in 2026, creating room for gold allocation within investment portfolios as investors may seek liquid alternatives. Meanwhile, central bank demand for gold is expected to support physical demand, providing a stabilizing anchor for the precious metals market.

In the 4H timeframe, gold is currently consolidating near US$4,635. The upward move is expected to extend toward the US$4,700 level, followed by a potential pullback for correction below US$4,500. A break below this level could trigger further downside toward US$4,430.

The MACD indicator supports a bullish outlook, with its signal line turning upward and advancing toward new highs, indicating sustained upward momentum.

Trading Direction: Buy

Entry Price: 4525

Target Price: 4740

Stop Loss: 4496

Valid Until: February 11, 2026 23:55:00

Support: 4615, 4585, 4573

Resistance: 4652, 4685, 4700

The EUR/JPY currency pair extended its winning streak for a fourth consecutive session on Wednesday, climbing to fresh all-time highs around 185.40 during early European trading hours. The cross has benefited from persistent Japanese yen weakness, driven by a combination of monetary policy uncertainty, fiscal concerns, and looming political developments in Japan, while the euro gains traction from signals that the European Central Bank (ECB) may be nearing the end of its rate-cutting cycle.

Bank of Japan Governor Kazuo Ueda reaffirmed on Wednesday that the central bank is prepared to adjust its interest rate policy should economic conditions and price dynamics meet expectations, particularly if wage growth and price inflation continue to rise moderately. Ueda’s comments, reported by Bloomberg, underscore the BoJ’s cautious stance amid persistent inflationary and growth pressures, leaving markets speculating on the future trajectory of Japanese monetary policy.

However, recent private sector data have painted a more cautious picture. Surveys indicate that Japan’s manufacturing activity has slowed, impacted by global trade frictions, while the services sector faces challenges from tourism-related disruptions. These headwinds constrain the BoJ’s ability to implement aggressive rate hikes, leaving the yen vulnerable to further depreciation.

Adding to the downward pressure, market participants are closely watching potential political developments. Reports suggest that Japanese Prime Minister Sanae Takaichi may call a snap election next month, with a Lower House vote tentatively scheduled for February 8. Analysts argue that such a move could enable Takaichi to consolidate power and pursue more aggressive fiscal stimulus measures, potentially weighing further on the yen. Finance Minister Satsuki Katayama echoed these concerns earlier this week, noting during a bilateral meeting with US Treasury Secretary Scott Bessent that the Japanese government is wary of the yen’s “one-sided depreciation.”

On the other side of the trade, the euro has benefited from encouraging macroeconomic data in the Eurozone. Headline inflation slowed to 2.0% in December, hitting a four-month low and aligning closely with the ECB’s 2% target, while core inflation eased slightly to 2.3%, marginally below market expectations. These developments support the view that the ECB may be close to completing its rate-cutting cycle, lending stability to the euro and enhancing the appeal of EUR/JPY trades for investors seeking relative yield advantages.

From a technical perspective, EUR/JPY has encountered some resistance around the 184.55 level, prompting a period of sideways consolidation. The pair has formed a temporary trading range as it contends with a mildly negative stochastic oscillator, which has settled below the 80 level, indicating that the bullish momentum is facing short-term exhaustion.

Traders may expect EUR/JPY to continue a pattern of temporary lateral movement until the pair can gather sufficient upward momentum. Should the cross maintain support above 184.85 and successfully breach the 184.55 barrier, the path could open for further gains, with the next target potentially near the 161.8% Fibonacci extension level around 190.00. Current technical signals suggest that the overall trend remains bullish, but short-term consolidation is likely before the next leg higher.

BUY EURJPY

ENTRY PRICE: 185.00

STOP LOSS: 182.00

TAKE PROFIT: 190.00

Oil markets experienced a sharp rebound this week, with Brent crude approaching mid‑$60 levels as traders factored in heightened geopolitical risk and potential supply disruptions. The benchmark North Sea crude, which had lingered below $60 per barrel for several weeks amid ongoing oversupply concerns, surged amid reports of intensifying civil unrest in Iran and mounting pressure from U.S. tariffs on countries trading with Tehran. West Texas Intermediate similarly posted gains above $60, signaling a broader improvement in market sentiment fueled more by political tension than by immediate physical supply constraints.

The primary catalyst for the recent rally is unrest in Iran, where protests have escalated amid worsening economic conditions and government crackdowns. Market participants have increasingly priced in the possibility that Iranian crude production, which represents roughly 3.3 to 3.5 million barrels per day, could be disrupted. Compounding these fears, President Trump announced a 25 percent tariff on goods from countries that continue to engage in trade with Iran, further clouding the outlook for Iranian exports. Traders have interpreted this move as an additional obstacle to Tehran’s already constrained crude flows, creating a risk premium for barrels potentially unable to reach international markets.

While the tariffs and unrest have driven immediate concerns, underlying structural factors continue to influence the market. Venezuelan exports, previously curtailed by sanctions, have begun to trickle back into the global market, providing some relief against sharply higher prices. Meanwhile, OPEC+ has maintained a cautious approach to production increases, pausing quota hikes despite the price rally. This strategy has established a soft floor for Brent in the high-$50s and low-$60s, supporting the current market levels even as demand growth remains modest. Nonetheless, the underlying oversupply that persisted through late 2025 continues to impose a ceiling on any dramatic price surge.

Technically, Brent crude has recently broken above a long-standing downtrend channel, a development that suggests a shift in market structure from bearish consolidation toward a more bullish accumulation phase. Following this breakout, the market has seen a moderate pullback, which traders interpret as a healthy retracement rather than a reversal. As long as prices remain above the breakout zone, the expectation is that buyers will re-enter the market, potentially sustaining an upward trajectory in the short to medium term. The combination of a confirmed breakout and a controlled retracement indicates that the market is digesting gains before potentially pushing toward higher levels, reflecting both technical strength and sensitivity to geopolitical developments.

From a trading perspective, the market currently favors long positions on retracements that are accompanied by bullish confirmation, such as renewed momentum above key short-term moving averages or sustained trading volumes. The immediate technical resistance lies near $63.74 per barrel, while the near-term upside could extend toward $70 if the geopolitical risk premium persists and Iran-related supply concerns intensify.

BUY WTI

ENTRY PRICE: 61.45

STOP LOSS: 57.50

TAKE PROFIT: 70.00

Silver (XAG/USD) continued its relentless ascent on Wednesday, extending gains for a fourth consecutive session and trading around the $90.50 level at the time of writing, up roughly 4.3% on the day. The move marks a new all-time high for the white metal and underscores the strength of a rally that is increasingly being fueled by a rare convergence of geopolitical stress, institutional uncertainty, and supportive monetary expectations.

The latest leg higher comes as global risk sentiment remains fragile. Investor demand for safe-haven assets has been reignited by intensifying geopolitical tensions in Iran, where widespread protests linked to soaring inflation, the sharp depreciation of the Iranian rial, and allegations of entrenched government corruption have placed authorities under severe pressure. According to human rights organizations, the government’s response has been increasingly violent, with reports of hundreds of deaths following a crackdown on demonstrators. This escalation has heightened risk aversion across global financial markets.

Adding to the unease, US President Donald Trump has warned that military options could be considered should the repression continue, injecting a further layer of geopolitical uncertainty into an already fragile environment. Historically, such periods of heightened geopolitical risk tend to favor precious metals, and silver has been a prime beneficiary, outperforming many traditional defensive assets.

Beyond geopolitics, silver is also drawing support from growing concerns surrounding institutional stability in the United States. Markets have been rattled by fears over the independence of the Federal Reserve following the launch of criminal charges against Fed Chair Jerome Powell related to the management of funds allocated for the renovation of the central bank’s headquarters in Washington. Powell has strongly rejected the accusations, describing them as politically motivated and warning that they could be used as leverage to influence monetary policy decisions.

Initially, these developments weighed heavily on the US Dollar, as investors questioned whether an erosion of central bank independence could undermine the credibility of US financial institutions and, in a more extreme scenario, threaten the country’s sovereign credit standing. While the greenback has since shown tentative signs of stabilization—helped by vocal support for Powell from major global central banks, including the European Central Bank and the Bank of England—the broader environment remains constructive for precious metals.

At the same time, expectations that the Federal Reserve will eventually be forced to cut interest rates continue to underpin silver prices. With real yields projected to decline and the US Dollar still facing structural headwinds, non-yielding assets such as silver remain highly attractive. This macro backdrop is reinforced by ongoing tightness in the physical silver market, where robust industrial and investment demand continues to limit supply flexibility.

From a technical perspective, silver has shown some intraday fluctuations as it attempts to consolidate recent gains and alleviate increasingly overbought conditions. Momentum indicators, particularly the Relative Strength Index, suggest the market is stretched, with early signs of negative overlapping signals emerging. However, these appear corrective rather than trend-changing.

Prices continue to trade comfortably above the 50-period exponential moving average (EMA50), reinforcing the dominance and stability of the prevailing bullish trend on a short-term basis. As long as silver holds above key support levels, the broader technical structure remains constructive. In my view, any near-term pullbacks are likely to be viewed as buying opportunities rather than a signal of trend exhaustion.

With macro risks unresolved, institutional confidence under scrutiny, and monetary conditions tilting in favor of hard assets, silver’s rally appears fundamentally supported. If current dynamics persist, the psychologically significant $100 level is no longer a distant target but a plausible medium-term objective for the market.

BUY SILVER

ENTRY PRICE: 91.90

STOP LOSS: 86.00

TAKE PROFIT: 100.00

On Japan's side, reports that Prime Minister Sanae Takaichi may push for an early general election have sparked significant concerns about fiscal and debt prospects. Media outlets noted that Takaichi could dissolve the House of Representatives shortly after the regular Diet session opens and hold a general election in February, which would force a rapid recess of parliament, delaying deliberations on the national budget and key legislation. Under current law, the Japanese government is generally prohibited from issuing bonds at will, relying for years on ad-hoc legislation to issue "deficit-covering debt" as exceptions to fill fiscal gaps. However, the existing authorization for such debts expires at the end of the current fiscal year. If new legislation fails to pass in time, the government will struggle to secure sufficient funds for next year's budget. This risk is particularly acute because Takaichi's proposed budget, a record high of nearly $783 billion, relies on debt financing for about a quarter of its total. Per government plans, most of the new debt issued in fiscal 2026 will be deficit-covering debt. Yet, Takaichi's ruling coalition holds only a slim majority in the House of Representatives and no majority in the House of Councillors, making legislative progress highly dependent on opposition cooperation. While the Democratic Party for the People previously signaled support for debt-related bills, the early election could disrupt political deals, with its leader stating their position is "in flux." Against this backdrop, markets are pricing in risks similar to the U.S. "fiscal cliff" scenario. Political uncertainty has quickly translated into financial market reactions. Expectations of an early election pushed up Japanese government bond yields, with the 10-year yield hitting a 27-year high, pressuring bond prices. Analysts note that rising political risks offer little upside for the bond market. Investors remain cautious about interest rate risks, keeping upward pressure on the yield curve. Considering Japan's debt-to-GDP ratio nears 200% and debt servicing costs continue to rise as a share of fiscal expenditure, fiscal sustainability concerns are amplified against the backdrop of potential Bank of Japan rate hikes. Additionally, expectations of looser monetary and fiscal policies this year further weigh on the yen.

The stronger dollar also supports USD/JPY. The Dollar Index (DXY) is approaching its monthly high near 99.25. In December 2025, the U.S. CPI rose 0.3% month-on-month, meeting market expectations and matching September's increase, while annual inflation held steady at 2.7%. Meanwhile, core CPI (excluding food and energy) rose 0.2% in December, below market expectations, though annual core inflation remained at 2.6%, tying the lowest level in four years. According to the CME FedWatch Tool, the probability of the Fed keeping rates unchanged this month held at 72% after the CPI report. Some major Wall Street banks delayed their rate cut forecasts from January/March to April/June, reflecting a reassessment of Fed policy expectations and supporting the DXY's rebound.

In the daily chart, the Bollinger Bands are widening upward, with moving averages diverging higher. Prices are trending strongly along the Bollinger Upper Band. After a golden cross, upward momentum remains robust, suggesting a high likelihood of testing 160 and 162. The RSI stands at 68, with higher lows, indicating dominant buying by market participants. At the same time, judging from the 4H chart, USD/JPY is oscillating upward along the Bollinger Upper Band and EMA12, remaining within an ascending channel. As long as the pair fails to break below EMA12 effectively, a test of 160 is likely. There is a possibility of a death cross, if formed, prices may pull back to around EMA12 (158.8) and the Bollinger Middle Band (158). The RSI is at 75, signaling overbought conditions, but adjustments could occur at any time. It is recommended to buy at lows.

Trading direction: Buy

Entry Price: 158.7

Target Price: 162

Stop Loss: 156.5

Support: 157.5/156.5/155

Resistance: 160/161/162

Today, WTI hovered around $60.80, with intraday movements characterized by a "short-term rally being suppressed by supply news" pattern. Markets are balancing between increased supply from Venezuela's restored exports and ongoing geopolitical risks related to Iran and Russia. Inventory data temporarily curbed upward momentum, leading to sharp but limited volatility driven by news flow.

First, the most direct factor altering today's price trajectory is Venezuela's resumption of supply. Reports indicate that, following changes in U.S. actions regarding Venezuelan exports, more Venezuelan crude is flowing to the U.S., increasing North American crude availability and widening the WTI-Brent discount, which exerts short-term downward pressure on WTI.

Second, official and industry data show a recent uptick in U.S. commercial crude inventories, with the API reporting a weekly increase of over 5 million barrels. This is viewed in trading circles as evidence of ample near-term supply, thereby restraining sustained upward price momentum. From the supply side and a political view, OPEC+ didn't make significant production expansions in the past months, maintaining a general stance focused on price stability. However, reports from institutions and the International Energy Agency (IEA) revised global supply growth downward, while demand improvements remain limited, creating a tug-of-war between "news-driven supply" and "structural supply-demand dynamics."

Based on the daily chart, WTI's recent candlestick patterns show a continuous uptrend after breaking through the previous downtrend channel. It briefly surpassed the $61.00 mark yesterday, but closed below it, indicating some resistance at this level.

Currently, WTI faces resistance in the $61.00–$62.00 range. If WTI fails to break above and sustain levels above $62.00 in the short term, the subsequent trend may resume its downtrend, with the first target potentially dropping to the $58.50 support level, or even falling to $55.00. Conversely, if WTI breaks above $62.00 and holds, its upside potential could expand further, with a possible test of the $64.00 resistance level.

Trading direction: Sell

Entry price: 61.00

Target price: 55.80

Stop loss: 62.50

Valid Until: January 28, 2026, 23:00:00

Support: 58.50/57.50

Resistance: 61.21/62.00