Gold rebounded above 5,220 and briefly hit 5,228. That is nearly 5% above last week’s low near 4,960. The rise was driven by tariff uncertainty and geopolitical risks, including the possibility of a US–Iran escalation.
The late-January dip looked more like a normal reset than a lasting trend change. Safe-haven buying picked up as investors worried about trade fragmentation and its impact on global growth, supply chains, and inflation.
Technical Levels And Near Term Bias
From a technical view, moving back above the 5,050–5,150 area shifted the near-term bias toward more gains. Bearish momentum on the daily chart has eased and RSI has moved higher. Resistance sits near 5,230/50, and a clear break could open the door for a retest of 5,350.
On the downside, the first support level is 5,120, followed by 5,024 (the 21 DMA), and then 4,850. A risk-off move tied to AI concerns, tariffs, and geopolitics has pushed gold higher while yields have fallen.
Markets are watching chip-sector earnings, US–Iran talks, and signals from the Federal Reserve. If tensions rise, traders holding USD short positions could face a squeeze.
A familiar pattern is forming in the gold market, similar to the rebound seen in early 2025. As last year showed, a late-January pullback can quickly turn into renewed strength. Tariff uncertainty and geopolitical pressure are again creating upside risk.
Trade Tariffs And Haven Demand
Safe-haven demand is returning as US–China trade tensions continue, especially after new 15% tariffs were placed on certain electronic components last month. This echoes the tariff headlines seen in 2025, which later helped drive a strong rally. Recent inflation data also points to rising cost pressure: the Producer Price Index increased 0.4%, suggesting higher input costs are moving through the supply chain.
Instead of the US–Iran situation that supported prices last year, attention is now on tensions in the South China Sea. This risk is helping support gold as a hedge against conflict. CME Group data shows open interest in gold call options is up 8% over the past two weeks, suggesting traders are positioning for a possible breakout.
From a technical standpoint, bullish momentum is rebuilding after price regained the key $2,420 level. For derivatives traders, this can support call buying or bull call spreads aimed at a retest of recent highs near $2,480. The 21-day moving average, near $2,405, can also be used as a reference for stop-loss placement on futures to manage risk.
Together, these forces are driving a familiar risk-off setup: gold rises while government bond yields fall. The US 10-year yield is already down 20 basis points this month, which improves gold’s appeal versus yield-bearing assets. In this backdrop, long positions in gold futures may make sense, especially if upcoming data signals slower growth.
Create your live VT Markets account and start trading now.
here to set up a live account on VT Markets now
