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Gold prices probing $5,000 level as oil remains volatile.
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Rising oil prices and bond yields are weighing on bullion.
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Geopolitical tensions are still offering a layer of safe-haven support.
Gold started the week on the back foot, extending the weakness that dominated the latter part of last week. The metal briefly slipped below the key $5,000 level, continuing the slide that saw prices fall nearly 3% over the previous week. At the time of writing, however, prices have edged back towards this psychological threshold, suggesting that buyers are still lurking around that area.
With now down for the second consecutive week and having declined over the past three trading sessions, momentum has clearly shifted to the bearish side in the near term. While the latest decline hasn’t been as dramatic as the sharp sell-off seen towards the end of January, it has still been significant enough to dent sentiment.
For the moment, gold appears to be caught between two powerful forces. On one side, escalating geopolitical tensions would normally support safe-haven assets such as bullion. On the other hand, the broader macro backdrop — particularly rising bond yields and a firmer US dollar — continues to weigh heavily on the metal.
Rising Yields Challenge Gold’s Resilience
A large part of the pressure on gold recently has come from the surge in energy prices. Crude oil has emerged as a dominant driver across global markets, with Brent crude extending its rally and pushing towards $105 per barrel after closing above $100 at the end of last week.
The shock in energy markets is now rippling through the broader financial system. Higher oil prices have revived concerns about inflation, prompting investors to reassess the outlook for monetary policy.
As a result, government bond yields have been climbing, while expectations for near-term interest-rate cuts have been pushed further out. The US dollar has strengthened in response, adding another layer of pressure on precious metals.
For gold, rising yields are typically a headwind. Unlike bonds or cash instruments, bullion does not generate income. When interest rates increase, the opportunity cost of holding a non-yielding asset such as gold rises, making it relatively less attractive for investors.
Until recently, gold had shown remarkable resilience to this dynamic. Even as yields climbed earlier in the year, the metal managed to maintain strong upward momentum. Over the past couple of weeks, however, that relationship appears to have shifted, with macroeconomic forces starting to outweigh safe-haven demand.
That said, geopolitical uncertainty is still providing an important buffer. Without the backdrop of heightened tensions, the recent sell-off in gold might have been far more pronounced.
Gold Technical Analysis and Trade Ideas
From a technical perspective, gold currently looks trapped in a level-driven consolidation phase. Volatility has picked up, but price action remains largely defined by key support and resistance levels rather than a clear directional trend.
Today’s brief move below the $5,000 psychological level is particularly noteworthy. This area has acted as support several times in recent sessions, with buyers repeatedly stepping in to defend it. A sustained break below that level — especially if confirmed by daily closes — would likely mark a deterioration in the short-term technical outlook.
Should the decline continue, the next notable support sits around $4,900, followed by $4,800. Beyond that, attention would likely turn to a broader trendline region near $4,700.
On the upside, former support around $5,060 to $5,150 could now act as resistance. This zone previously provided a floor for prices before last week’s breakdown and may now cap any rebound attempts. A move back above that region would open the door for a retest of $5,200.
For now, gold remains caught in the middle of powerful macro crosscurrents. If oil prices begin to stabilise and bond yields ease, the metal could quickly regain upward momentum. Until then, however, the near-term outlook may be defined less by trend and more by continued volatility and level-to-level trading.
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Disclaimer: This article is written for informational purposes only; it does not constitute a solicitation, offer, advice, counsel or recommendation to invest as such it is not intended to incentivize the purchase of assets in any way. I would like to remind you that any type of asset, is evaluated from multiple perspectives and is highly risky and therefore, any investment decision and the associated risk remains with the investor.
