Drivers Behind The Gold Rebound
Another factor was uncertainty over US interest rates, including the chance the Federal Reserve may slow or delay its next rate cut. Higher oil prices were also cited as a risk for US inflation. Technical levels were set out with resistance at 5260 and 5315. Support levels were 5105 (21 DMA) and 5060. The article states it was produced with the help of an AI tool and reviewed by an editor. We are seeing gold extend its recovery as the dollar weakens and oil prices retreat. This shift presents opportunities for traders using options and futures, especially as market fears around the Iran conflict begin to calm down. The stabilization in risk sentiment is a key factor to watch in the coming weeks.Key Levels And Trade Setups
The U.S. Dollar Index has fallen below 103, largely because February’s non-farm payrolls came in slightly softer than expected at 195,000. This has boosted market expectations, with the CME FedWatch tool now pricing in a 65% chance of a rate cut by the June meeting. This potential pivot from the Fed is creating a tailwind for non-yielding assets like gold. We believe the phase of asset liquidation to raise cash, which weighed on gold during the recent market stress, is now passing. Furthermore, after a slowdown in the final quarter of 2025, official sector buying is showing signs of life again. The latest World Gold Council data for January 2026 confirmed a net purchase of 39 tonnes by central banks, suggesting institutional demand is returning. This pattern is reminiscent of the market action we saw in late 2025, where an initial flight to cash was followed by a strong recovery in gold. For the coming weeks, we see the support zone of 5105 to 5060 as a key area to watch for entry points. Traders might consider strategies like selling cash-secured puts or initiating bull call spreads to capitalize on a potential move towards resistance at 5260. Create your live VT Markets account and start trading now.
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