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. Nonetheless, this also presents another opportunity to enter long positions.
In terms of specific movement, gold opened in Asia at $4,987.98 per ounce, initially declined to fill the gap, recording an intraday low of $4,964.04, then rebounded and fluctuated within a range. In the latter half of the US session, bulls regained strength, reaching an intraday high of $5,086.29 at the close, and finally settled at $5,058.07. 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 that negotiations with Canada on bilateral issues would begin immediately. White House officials stated that President Trump explicitly opposes Israel’s annexation of the West Bank. This reduced safe-haven demand. Additionally, Trump set a 15% economic growth target, strengthening the dollar initially and pressuring gold prices, which fell early.

However, the impact was limited; in the short term, these are just expectations without substantial basis, representing only short-term pressure. Today, focus will be on US December retail sales month-over-month, US November business inventories month-over-month, and other data. Market expectations are bullish for gold, so 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 published data and market expectations, the overall outlook is likely to be positive for gold. Therefore, trading this week will mainly favor a low-buying strategy. Even if the final results are bearish for gold, the market is expected to fluctuate mainly within a range, so maintaining a bullish bias is not problematic.
Fundamentally, the bulls are showing signs of regaining strength. After previous corrections, the outlook for gold remains optimistic for new highs. This recent pullback appears to be a rapid re-pricing in a high-volatility environment rather than a trend reversal. Amid increased volatility across major global asset classes, funds frequently switch between risk assets and safe havens, causing gold to exhibit sharp rises and falls. The bullish trend remains intact.

Currently, the latest data shows job vacancies have fallen to 6.54 million, while weekly initial unemployment claims have risen to 231,000, both indicating a cooling labor market. This change is significant—it not only suggests a higher likelihood of further inflation decline but also boosts market expectations for the Federal Reserve to start cutting rates this year. If upcoming data like non-farm payrolls again meet expectations, it will further support the medium- to long-term bullish case for gold.
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 again or extend last week’s rebound to new highs. Overall, the bull market trend remains ongoing.
Technically, on the monthly chart, after continuing the January bearish reversal and plunging in February, gold found support at the breakout resistance of the early-year upward trend, then rebounded, indicating that the bearish correction in January has run its course. The new bull phase remains valid, and future strength will likely stay above this trend support, either resuming an upward move after oscillation or strengthening again after consolidation. Key support is around $4,300; staying above this level maintains bullish expectations for new highs, while closing below suggests the end of the bull market.

On the weekly chart, gold bottomed and rebounded last week, ending the previous top-down correction pattern, which suggests a potential shift to renewed strength. The overall trend remains upward, with support at the 5- and 10-week moving averages, so buying on dips continues to be a valid strategy.
On the daily chart, gold recently rebounded after retesting the upward trend channel support, currently trading above channel support and the middle Bollinger Band, with bulls in control. This indicates potential for new highs ahead. Support levels include short-term moving averages and the middle line of the Bollinger Bands, offering good entry points for bullish positions.

Gold: support at around $4,950 or $4,860; resistance at around $5,110 or $5,190;
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. Trade at your own risk.
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