Gold and Silver have experienced a rebound following dip-buying interest as the pressure from forced selling subsides. The report from OCBC Bank, by authors Sim Moh Siong and Christopher Wong, suggests this rebound indicates a pause in liquidation pressures, at least temporarily.
Sentiment remains cautious with expectations of consolidation rather than a trend reversal. Confidence in the market is not fully restored, hinting at potential choppy, two-way trading ahead. The year-end projections for Gold and Silver are USD5,600/oz and USD133/oz, respectively.
The FXStreet Insights Team
The FXStreet Insights Team consists of journalists who curate market observations from experts. This article involved input from both commercial entities and additional insights from internal and external analysts. A combination of artificial intelligence assistance and editorial review was used in crafting this content.
The recent rebound in gold from the $4,700 level is a positive development after the sharp sell-off seen in mid-January 2026. This dip-buying suggests the forced selling from margin calls has likely faded for the moment. We should prepare for a period of consolidation, as confidence has not fully returned to the market.
Given the expectation of choppy, two-way trading, we can capitalize on this by selling premium through options. This environment is favorable for strategies like iron condors or selling strangles on gold futures, as implied volatility has decreased after the January spike. The Cboe Gold ETF Volatility Index (GVZ) settling back to around 18 from its recent high of 25 confirms this period of temporary calm.
Market Position Reset
The washout of positions seems to be confirmed by the data we saw last month. Looking back at the CFTC reports from late January, there was a significant reduction in net-long positions held by hedge funds, the largest one-week drop since the third quarter of 2025. This reset means the market is less vulnerable to another immediate, sharp decline from crowded positioning.
Despite this near-term caution, the long-term bullish case remains intact, supporting our year-end price target of $5,600 per ounce. Persistent inflation, with the last CPI report for January 2026 showing an annualized rate of 4.1%, continues to be the primary driver. We should therefore use any price weakness over the next few weeks as an opportunity to accumulate long-dated call options or scale into futures positions.
Silver has shown relative strength during this rebound, with the gold-silver ratio narrowing to 42. This is still historically wide compared to the sub-40 levels we saw in late 2025, suggesting silver could outperform gold if bullish momentum returns. We can look to add exposure on any dips toward the $110 support level.
