Zhang Yaoxi: Non-farm data incoming, gold prices fluctuate and await a rally

Zhang Yaoxi: Non-Farm Data Incoming, Gold Prices Fluctuate and Await a Rise
On the previous trading day, Tuesday (February 10): International gold prices fluctuated and closed lower. Although December U.S. retail sales unexpectedly stagnated, pushing gold prices to rise temporarily, Federal Reserve officials downplayed the urgency of rate cuts. White House officials rebutted concerns about worsening employment, then quickly gave back gains, failing to strengthen further. The bullish momentum eased but remained above the middle band of the Bollinger Bands, indicating potential for further strength and upward movement in the future.
In terms of specific trends, gold opened at $5,058.44 per ounce during Asian hours, experienced rapid fluctuations, and showed intraday volatility. It touched the $5,076 level before falling back to a daily low of $4,987.28. Afterward, it stabilized and continued to fluctuate, reaching an intraday high of $5,078.39 during the U.S. session before encountering resistance and retreating again, remaining in a sideways pattern. It ultimately closed at $5,025.33, with a daily range of $91.11, down $33.11, or 0.65%.
Looking ahead to Wednesday (February 11): International gold opened stronger, supported by U.S. retail sales data and threats from Trump to possibly send additional aircraft carrier strike groups to the Middle East, which still created some buying interest in gold.

However, focus will be on the U.S. January non-farm payrolls (seasonally adjusted), expected to be higher than the previous figure, which could be bearish for gold and limit intraday rebounds. Yet, since ADP and initial jobless claims data released last week showed declines, non-farm payrolls may come in below expectations, which would be bullish for gold. Additionally, the forecast for the U.S. January average hourly wage growth is expected to decline, so even if data meets or exceeds expectations, gold prices are likely to remain volatile within a range. Therefore, the strategy should mainly be to buy on dips and use short positions as a supplement.
Fundamentally, although Fed Chair Harker stated that there is no urgent need for rate cuts this year, Trump argued that our interest rates should be 2 percentage points lower than they are now. The Fed Chair also said future data will be key, but recent data tends to support rate cuts. This dampening of rate cut expectations has minimal impact. If upcoming data such as non-farm payrolls and PPI further support rate cuts, gold could rise again; otherwise, it may continue to fluctuate sideways.
Technically, on the monthly chart, gold in February continued the bearish reversal from January, plunging again. After touching the support level of the upward trend resistance broken earlier this year, it rebounded and stabilized within a new bull market space, remaining above the 5-month moving average. This indicates that the bearish correction in January has been exhausted, and the new bullish outlook remains valid. The trend is expected to strengthen again or fluctuate before resuming an upward move.
On the weekly chart, gold bottomed out and rebounded last week, closing above the 5- and 10-day moving averages, suggesting that the previous top-reversal pattern is exhausted and a renewed upward trend is likely. The overall trend remains upward, so support at the 5- and 10-week moving averages remains key, and buying on dips continues to be a valid approach.
On the daily chart, gold’s rebound momentum has weakened but it still remains above the middle Bollinger Band and the previous upward trend channel, indicating bulls still hold the advantage. Support levels are at the middle Bollinger Band and the upward trend channel, providing opportunities to continue bullish positions. Resistance awaits at the upper Bollinger Band.

Gold: Support at around $4,970 or $4,870; resistance at around $5,100 or $5,170.
Silver: Support at around $79.15 or $78.55; resistance at around $84.00 or $86.70.
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).

U.S. futures gold price = London spot price × (1 + gold swap rate × futures days to expiry / 365)
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