.jpg)
Gold Holds Defensive Below Two-Week High; Bearish Conviction Limited Amid Mixed Signals
Gold prices remained on the defensive during Thursday’s Asian session, posting moderate intraday losses but lacking follow-through selling pressure. The precious metal stayed close to its nearly two-week high reached the previous day, trading above the $5,070 level and slipping just over 0.20% on the day as markets weighed mixed macro signals.
The 21-day Simple Moving Average (SMA) has moved above the 50-, 100-, and 200-day SMAs, all trending higher and highlighting a strong bullish technical structure. Prices continue to hold comfortably above these indicators, with the 21-day SMA at $4,940.96 providing immediate dynamic support. Meanwhile, the 14-day Relative Strength Index (RSI) stands at 57.99, signaling neutral-to-bullish momentum after easing from recent highs but remaining above the key 50 threshold.
Measured from the swing high of $5,597.89 to the low of $4,401.99, the 61.8% Fibonacci retracement at $5,141.05 acts as the nearest resistance, while the 78.6% retracement at $5,341.96 caps the next upside zone. A sustained breakout above the first level could pave the way toward the latter, while failure to advance may shift focus back to the rising 21-day SMA as initial support and keep the recovery confined within broader retracement boundaries.
Despite pulling back from Wednesday’s eight-day high of $5,119, downside pressure on gold remains limited due to renewed selling interest in the US Dollar (USD). The greenback continues to face pressure from spillover effects tied to the ongoing decline in USD/JPY, driven by Japanese political developments and lingering forex intervention risks.
This bearish USD/JPY backdrop overshadowed a strong US labor market report released Wednesday. January Nonfarm Payrolls rose by 130,000, significantly above the expected 70,000, while the unemployment rate unexpectedly fell to 4.3% from 4.4% in December 2025.
The robust employment data has largely eliminated expectations of a Federal Reserve rate hike in March while slightly reducing the odds of rate cuts in June, according to CME Group’s FedWatch Tool. These shifting expectations reinforced the “higher-for-longer” interest rate narrative, boosting the USD and US two-year Treasury yields at the expense of non-yielding assets like gold.
However, USD gains quickly faded, limiting gold’s decline as markets digested the final revision to the annual NFP benchmark, which showed the US economy added only 181,000 jobs in 2025 instead of the previously estimated 584,000, according to Reuters.
At the same time, lingering geopolitical tensions between the US and Iran have helped sustain safe-haven demand for gold. Reuters reported that after speaking with Israeli Prime Minister Benjamin Netanyahu, President Donald Trump stated that no “definitive” agreement had been reached on how to proceed with Iran, though negotiations with Tehran would continue.
Looking ahead, US Initial Jobless Claims data due Thursday may provide fresh insight into labor market conditions. However, Friday’s US Consumer Price Index (CPI) report will likely serve as the key test for gold bulls, as inflation data could reinforce bets on two Federal Reserve rate cuts this year, with the first potentially arriving in June.