Gold prices opened Monday’s trading with losses of 1.5%, erasing most of the previous session’s gains of 1.7%, trading near the crucial level of $5100 per ounce.
Gold is currently trading above the bullish trend line, looking to stabilize above it then break through the weekly pivot point at $5195. It should be noted that exceeding the aforesaid pivot point may help prices regain their main upward march, heading towards resistance levels at $5395 then $5619.
If gold fails to break through the weekly pivot point at $5195, it may test the bullish trend line, breaking it would be a negative signal that could reinforce selling pressure, opening the way for prices to fall towards support levels at $4971, followed by $4772.
In terms of geopolitical escalation, the joint U.S. and Israeli assault on Iran will likely be the dominant topic for markets this week.
Over the weekend, air strikes on critical infrastructure were exchanged between both sides, sidelining already waning hopes that the fighting would come to a relatively quick conclusion.
These concerns were further underlined when Mojtaba Khamenei was named the next supreme leader of Iran. Even before the news broke, U.S. President Donald Trump had warned that such the selection of the son of former leader Ayatollah Ali Khamenei – who was slain in the initial bombardments by the U.S. and Israel on February 28 – was “unacceptable.”
From a fundamental perspective, into this backdrop will step two major trackers of U.S. inflation this week.
The first, set to be released on Wednesday, will be a gauge of consumer price increases in February. Economists anticipate that the consumer price index accelerated slightly to 2.5% in the twelve months to February, up from 2.4% in January. Month-on-month, it is seen speeding up marginally to 0.3% from 0.2%.
Then on Friday, the core personal consumption expenditures price index for January will be unveiled, with analysts forecasting an annualized pace of 3.1% and 0.4% month-on-month. The gauge will receive particular attention, as it is widely considered to be one of the Federal Reserve’s preferred inflation metrics.
Finally, GDP data will also be of paramount importance, economists expect the U.S. economy to grow by 1.4% in the last four months of 2025, compared to 4.4% in the third quarter.