Last Updated on February 17, 2026 by Deon
Gold: (XAU/USD) is kicking of the week on a subdued note as tensions simmer over gold’s direction. Though it slipped a bit on Monday — an intraday low saw it briefly reach around $4,965 before rebounding to flirt with the $5,004 level — the “yellow metal” is more or less just pausing for air.
With a stronger U.S. Dollar and mixed messages on the economic front, traders are simply not willing to make bold bets either way. Here’s a look at what is moving the gold needle right now.
The Fed’s Balancing Act: Inflation or Jobs
“It’s the expectation of what the Fed will do with interest rates that really is driving gold right now.” Investors had plenty of data to gnaw on from last week’s dump:
Cooling inflation: Consumer prices (CPI) rose just 0.2% in January and are up 2.4% over the past year. If true, this bodes well for gold – it means that the Fed’s “inflation fight” is paying off.
A Job Market That Bounced Back: On the other hand, the economy added 130,000 jobs — far more than expected. A strong economy, in general, allows the Fed to let interest rates rise for a longer period of time and this can weigh on gold prices.
The Bottom Line Markets are now pricing in roughly 50 basis points of rate cuts this year, which may begin as soon as next month. Gold because doesn’t pay interest, it tends to become more attractive when rates decline.
Geopolitical Wildcards and “Safe-Haven” Demand
Gold always finds a home when the world gets jittery. They are watching Geneva, where high-stakes nuclear negotiations between Iran and the United States have resumed.
Iran has indicated that it is ready to make a deal if sanctions are on the table. If these negotiations go smoothly, some of the “risk premium” in gold would come out of the market. But until those tensions dissipate in the Middle East, investors will probably hold on to gold as financial insurance.
Technical Outlook: Key Levels to Watch
To those chart watchers out there, gold is in the process of forming what’s called an ascending triangle. This indicates that though the price is consolidating, long-term pressure is being created to the upside.
Key LevelSignificance$5,100The major “breakout” ceiling. A break by gold over this level and we could get a new rally. $5,004Current psychological pivot point. $4,900Strong support that preserves the trend.
What’s Next This Week?
There will be a little bit of “choppy” in the market action today, particularly because U.S. markets are closed for Presidents’ Day. But the volatility will probably pick up in earnest later this week, with three potential catalyzing events:
Wednesday: The release of the FOMC Meeting Minutes, which will show how hawkish or dovish Fed officials really are.
Friday: The Core PCE, the Fed’s preferred metric for inflation.
GDP Estimates: New figures for economic growth will help sort out whether the United States is headed for a soft landing or something bumpier.
