On Monday, February 16th, international gold prices encountered resistance and closed lower in thin trading, influenced by expectations for negotiations on multiple geopolitical fronts and market closures in several countries. In the short term, prices continue to face some pressure for volatile adjustments. Looking ahead, unless the price rebounds and closes above $5,100, a strategy of treating the market as range-bound is appropriate. Investors may consider re-entering long positions upon a pullback to the support levels of the 30-day or 60-day moving averages.
In terms of specific price action, gold opened the Asian session at $5,042.31 per ounce, which also marked the day's high. The price trended weaker throughout the day, experiencing volatile swings and twice falling below $4,970. It recorded a daily low of $4,965.63 towards the end of the Asian session before closing the US session at $4,993.60. The daily trading range was $76.68, resulting in a decline of $48.71, or 0.97%.
Looking to Tuesday, February 17th, international gold opened lower, extending Monday's downward pressure and facing resistance from the middle Bollinger Band and short-term moving averages. Additionally, the US Dollar Index's recent trend of fluctuating with an upward bias is exerting some downward pressure on gold. Therefore, in the short term, gold prices are still expected to undergo volatile adjustments. Investors should watch for potential re-entry opportunities around the support levels of the 30-day and 60-day moving averages.
Key data releases to watch during the day include the US Empire State Manufacturing Index for February and the NAHB Housing Market Index for February. Market expectations are mixed, suggesting potential for volatile price movements. Furthermore, speeches are scheduled by Fed Governor Barr on AI and the labor market at 01:45 the following day, and by 2027 FOMC voting member and San Francisco Fed President Daly on AI and economic issues at 03:30 the following day. Given their previously dovish tones, these comments are expected to be supportive of gold prices. Consequently, the intraday trading strategy could involve selling on rallies first, then buying on dips. Specific entry and exit points should be based on the technical analysis provided.
Fundamentally, although thin holiday trading and renewed geopolitical negotiations have reduced demand for gold, leading to a weaker adjustment phase, uncertainty remains regarding the outcome of these talks. US Secretary of State Rubio has stated that reaching an agreement with Iran will be very difficult. Furthermore, ahead of US-Iran negotiations, the US Air Force deployed an additional 18 F-35 fighter jets to the Middle East, while the Iranian Revolutionary Guard Corps Navy conducted exercises in the Strait of Hormuz, indicating risks that could swiftly heighten safe-haven demand.
Additionally, Russia-Ukraine negotiations are reportedly scheduled for February 17th in Geneva. However, President Zelenskyy has stated that Ukraine will not cede any territory. Overall, these factors may once again elevate geopolitical risks and support gold prices. Therefore, in the short term, gold prices are likely to remain volatile.
Regarding the broader outlook, expectations for a new bull market high remain intact. Although recent US economic data have tempered expectations for interest rate cuts, the overall cycle of monetary easing still exists. Some officials and former President Trump continue to advocate for more substantial rate reductions, suggesting that the factors driving gold prices higher are merely delayed, not absent. Coupled with persistent gold purchases by central banks providing a foundation for long-term bulls, and the recurring nature of geopolitical tensions, any current or short-term adjustment is likely creating entry opportunities for bullish positions. Expectations for new highs within the year persist.
Technically, on a monthly chart, after gold extended its decline following January's bearish inverted hammer candlestick pattern in February, it found support at the level of the former resistance-turned-support of the initial 2024 breakout trendline. The subsequent rebound has kept the price within the new bull market zone and above the 5-month moving average, indicating that the bearish correction from January may be exhausted. The bullish outlook for a new uptrend remains valid, with prices expected to strengthen further either by holding above this trendline support or after a period of consolidation.
On a weekly chart, although gold closed higher last week, bullish momentum has clearly weakened. This week's price action has again encountered resistance. Initial support is seen around the 5-week moving average near $4,960, with further support near the 10-week moving average around $4,720, which could present a buying opportunity.
On the daily chart, recent volatile performance has prevented a sustained rebound above short-term moving averages. The price is currently expected to enter another phase of adjustment. Oscillator indicators are also signaling weakness, suggesting a potential retest of the 30-day or 60-day moving average supports. Resistance is noted near the 5-day moving average and the area of recent repeated rally attempts, where selling pressure might emerge. Buying opportunities may arise upon a pullback to the moving average supports.
Intraday specific entry points for reference are as follows. Actual entry and exit points should be confirmed with real-time account guidance: Gold: Support levels to watch are near $4,925 or $4,880; resistance levels are near $5,000 or $5,045. Silver: Support levels to watch are near $74.25 or $72.40; resistance levels are near $77.30 or $78.90.