Gold Prices Tumble Below $2,900 as Traders Cash In on Record Highs

Gold prices fell sharply on Friday, February 14, 2025, as traders booked profits following a week of record highs. By Saturday morning, February 15, gold futures were trading at $2,893.7 per ounce, marking a 1.75% decline from the previous day. This drop came after the metal briefly touched $2,964.1 earlier in the week, its highest level ever.

The sell-off was driven by mixed economic signals and profit-taking ahead of the weekend. U.S. retail sales data for January revealed a steep 0.9% decline, far worse than the expected 0.1% contraction. This weakened the U.S. dollar and Treasury yields but also prompted speculation about Federal Reserve rate cuts later this year. While lower yields typically support gold, traders took the opportunity to cash out after a prolonged rally.

Globally, gold markets reflected similar trends. In India, 24-carat gold traded at ₹87,170 per 10 grams on Saturday morning, holding steady despite international volatility. Pakistan reported prices at Rs. 300,600 per tola for 24-carat gold, while European markets saw prices soften from earlier highs of €2,698 per ounce.

Central banks remain a key pillar of support for gold prices, with purchases exceeding 1,000 tons annually for three consecutive years. However, geopolitical developments also played a role in Friday’s decline. Reports of progress in peace talks over the Ukraine conflict reduced safe-haven demand for bullion.

Gold Prices Tumble Below $2,900 as Traders Cash In on Record Highs

ETF flows highlighted the cautious sentiment among institutional investors. Gold ETFs recorded moderate outflows on Friday as traders adjusted their portfolios amid heightened uncertainty. Trading volumes surged to over 216,000 contracts—well above average—indicating significant market activity.

Technical indicators suggest further consolidation could occur before another upward move. Gold’s key support levels are at $2,850 and $2,790, while resistance remains at $2,900 and the all-time high of $2,942. The Relative Strength Index (RSI) exited overbought territory this week, signaling a potential pause in the rally.

Despite recent volatility, analysts remain optimistic about gold’s long-term prospects due to persistent global uncertainties and expectations of Federal Reserve rate cuts later this year. However, traders will closely watch upcoming U.S. economic data and geopolitical developments for further direction.