Gold Retreats to $2,895 After Rally Fizzles Amid Profit-Taking and Dollar Strength

Gold prices opened this morning at $2,895 per ounce, down from yesterday’s peak of $2,930. This decline follows a volatile trading session on February 26, where early optimism gave way to profit-taking and a stronger U.S. dollar.

The rally, which briefly lifted prices near record highs, faltered as investors reassessed positions amid rising Treasury yields and weaker physical demand. The market’s retreat highlights the delicate balance between bullish sentiment and external pressures.

Yesterday’s rally was driven by safe-haven demand sparked by geopolitical tensions and uncertainty over U.S. trade policies. However, as the U.S. Dollar Index edged up by 0.2%, gold’s appeal weakened for international buyers.

Meanwhile, the yield on the 10-year U.S. Treasury note climbed, further reducing the attractiveness of non-yielding assets like gold. Overnight trading saw prices stabilize around $2,909 before slipping further in early Asian and European sessions.

Key markets such as the COMEX in New York showed increased selling pressure, while physical demand in China remained subdued on the Shanghai Gold Exchange. In India, gold prices dropped further, with 24K gold trading at ₹87,380 ($14,563) per 10 grams in Mumbai.

ETF flows also played a role in shaping sentiment. Gold-backed ETFs saw inflows of 52.4 tons last week, equivalent to $4.9 billion, marking the largest weekly inflow since March 2022.

Gold Faces Short-Term Bearish Pressure

However, recent days have seen modest outflows as prices corrected from their highs. COMEX trading volumes remain robust but skew toward short positions as traders anticipate further declines.

Technical analysis suggests gold remains under short-term bearish pressure after breaking below key support levels. Resistance at $2,935 continues to cap upward momentum, with downside risks pointing to $2,825 if sentiment worsens.

Market analysts offered mixed views on gold’s trajectory. Ross Norman noted that profit-taking drove the correction but predicted fresh physical demand at lower levels. David Meger emphasized that the broader bullish trend remains intact despite recent consolidation.

Gold’s next moves hinge on upcoming U.S. economic data and geopolitical developments. While short-term pressures persist, long-term fundamentals could still support a return above $3,000 per ounce later this year.

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error

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