Zhang Yaoxi: Data expectations pressure the dollar to stay weak, with gold prices remaining low and primarily bullish

Zhang Yaoxi: Data Expectations Pressure, Dollar Slightly Weak, Gold Prices Remain Low with a Bullish Outlook
On the previous trading day, Monday (February 9): International gold opened higher and then rebounded to close higher, driven by weekend geopolitical tensions and expectations of major data releases this week. The US dollar index initially declined, supporting gold prices to stay above the midline and breaking through the 10-day moving average resistance. However, further bullish momentum requires sustained positive closes; otherwise, a pullback to the midline or the 30-day moving average support may occur, which also presents another entry opportunity for long positions.
In terms of specific movement, gold opened in Asia at $4987.98 per ounce, initially declined to fill the gap, recording an intraday low of $4964.04, then rebounded and fluctuated within a range. In the latter half of the US session, bulls regained strength, pushing to an intraday high of $5086.29 at the close, ending at $5058.07. The daily range was $122.25, closing up $70.09 from the open, a 1.41% increase.
Looking ahead to Tuesday (February 10): International gold briefly strengthened at the open before falling back, recovering some of Monday’s gains. Early in the session, US President Trump announced immediate negotiations with Canada on bilateral issues. White House officials stated that President Trump explicitly does not support Israel’s annexation of the West Bank. This reduced safe-haven demand. Additionally, Trump set a 15% economic growth target, which initially strengthened the dollar and pressured gold prices, causing an early drop.
However, the impact was limited; in the short term, these are just expectations without substantial basis. The market will focus on US December retail sales month-over-month and US November business inventories, with expectations favoring gold prices. Therefore, intraday trading will continue to favor buying on dips.
Furthermore, this week will see US January unemployment rate, US January non-farm payrolls (in ten-thousands), and US January CPI year-over-year and month-over-month data. Based on last week’s data and market expectations, the overall outlook is likely bullish for gold. Thus, the main strategy remains to buy on dips. Even if the final results are negative for gold, the movement will likely be volatile, so maintaining a long bias is reasonable.
Fundamentally, bulls are showing signs of regaining strength. After previous corrections, the outlook for gold remains optimistic for new highs. This correction appears to be a rapid re-pricing in a high-volatility environment rather than a trend reversal. Amid increased volatility across major global assets, funds frequently switch between risk and safe assets, causing gold to experience sharp rises and falls. The bullish trend remains intact.

Currently, latest data shows job vacancies have fallen to 6.54 million, while weekly initial unemployment claims rose to 231,000, indicating a cooling labor market. This change is significant—it suggests a higher likelihood of further inflation decline and boosts market expectations for the Fed to start cutting rates this year. If upcoming data like non-farm payrolls again meet expectations, it will further support gold in the medium to long term.
Therefore, during the Fed’s rate-cut cycle, gold prices are expected to maintain an upward trend, though short-term adjustments may occur due to geopolitical fluctuations and dollar strength driven by other central bank policies. Consequently, gold may either continue to oscillate sideways for several weeks before rising or extend last week’s rebound to new highs. Overall, the bull market trend remains ongoing.
Technically, on a monthly chart, gold in February continued the downward trend from January’s bearish reversal, but after testing support at the breakout resistance from early in the year, it rebounded, indicating that January’s decline has been exhausted. The new bull phase remains valid, and the price is expected to stay above this support, either strengthening further or oscillating before rising again. Key support levels are around $4,300; staying above this suggests a new high in the bull market, while closing below indicates the end of the bull trend.

On the weekly chart, gold bottomed out and rebounded last week, ending the previous top-down correction pattern, suggesting a potential shift to strength again. The overall trend remains upward, with support at the 5/10-week moving averages, so buying on dips continues to be a valid strategy.
On the daily chart, recent rebounds after retracing the prior upward channel support, with prices currently above channel support and the middle Bollinger Band, indicating bullish dominance. This suggests further new highs are possible. Support levels include short-term moving averages and the middle band, providing good entry points for longs.

Gold: support at around $4950 or $4860; resistance at around $5110 or $5190;
Silver: support at around $80.30 or $79.00; resistance at around $86.20 or $87.70;
Note:
Gold TD = (International gold price × exchange rate) / 31.1035
A $1 fluctuation in international gold prices roughly causes a $0.25 change in Gold TD (theoretically).

US futures gold price = London spot price × (1 + gold swap rate × days to expiry / 365)
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The above opinions and analyses are solely the author’s personal views, for reference only, not trading advice. Operate at your own risk.
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