Gold (XAUUSD) moved higher toward the $5,045 level during early Asian trading on Monday. The precious metal extended its recovery, supported by a softer US dollar and continued central bank demand. Market focus now shifts to the delayed US January employment report, set for release on Wednesday.
Meanwhile, US Treasury Secretary Scott Bessent on Thursday declined to dismiss the possibility of a criminal investigation into Kevin Warsh, President Donald Trump’s nominee for Federal Reserve Chair, should Warsh ultimately refuse to lower interest rates. Concerns surrounding the Fed’s independence continue to weigh on the greenback, providing support to dollar-denominated commodities such as gold.
Nikkei Hits Record Highs as PM Takaichi Secures Election Victory
Japan’s ruling coalition, led by Prime Minister Sanae Takaichi, is poised for a decisive win in Sunday’s snap general election.
According to projections from public broadcaster NHK, the coalition headed by Takaichi’s Liberal Democratic Party (LDP) has captured 352 of the 465 seats in the House of Representatives, with the LDP alone securing an outright majority of 316 seats.
Japanese equities recorded their strongest rally since April, as Takaichi’s historic victory boosted expectations of expanded fiscal spending across key sectors.
The Nikkei 225 surged as much as 5.7% to a new record high of 57,337.07 by 10 a.m. local time, while the broader Topix index climbed up to 3.4% to reach fresh highs. Technology and machinery stocks led the advance, with several semiconductor equipment makers jumping more than 10%.
Key Symbols to Watch
XAUUSD | USDX | XAGUSD | SP500 | BTCUSD | ETHUSD
Upcoming Events
| 10 Feb | USD | Retail Sales | 0.40% | 0.60% | Softer consumer activity could pressure the Dollar |
| 11 Feb | USD | Average Hourly Earnings m/m | 0.30% | 0.30% | Strong wages may support Warsh’s hawkish stance |
| 11 Feb | USD | Non-Farm Employment Change | 70K | 50K | A strong beat could weigh on Gold below $5,000 |
| 11 Feb | USD | Unemployment Rate | 4.40% | 4.40% | A higher rate may reinforce a softer Fed tone |
| 13 Feb | USD | Core CPI | 0.30% | 0.20% | Higher inflation could revive rate hike expectations |
Key Movements of the Week
Gold (XAUUSD)
XAUUSD found firm support at the 4650 level.
If bullish momentum continues, price could advance toward the 5070 resistance level.
A decisive breakout above 5070 may open the door for further upside.
Silver (XAGUSD)
XAGUSD established support near the 65 level.
Buyers may attempt to push Silver back toward the 91 level.
Upcoming NFP data will likely play a key role in Silver’s direction.
U.S. Dollar Index (USDX)
USDX rallied and retested the 97.2 level.
However, it struggled to break above the 97.85 resistance zone.
The 97.85 level remains critical, with CPI data likely to determine the next move.
USDJPY
USD/JPY faced rejection near the 157.600 resistance level.
The pair is currently holding above the 156.000 support zone.
Failure to maintain 156.000 could expose prior lows.
Bitcoin (BTCUSD)
Bitcoin briefly traded below $60,000 before rebounding.
The $70,000 level remains a key resistance area after multiple failed attempts.
The broader structure remains bearish, with potential for a retest of $60,000.
Ethereum (ETHUSD)
Ethereum dropped to $1,750 before recovering above $2,000.
Price is currently testing the $2,000 resistance level.
A sustained move higher could target the next resistance at $2,400.
Bottom Line
Expectations of deeper interest rate cuts by the US Federal Reserve in 2026, supported by signs of cooling in the US labor market, have strengthened the case for the non-yielding yellow metal.
At the same time, the White House reiterated that diplomacy remains President Donald Trump’s preferred strategy in dealing with Iran, while acknowledging that military options remain available.
This backdrop keeps geopolitical risks elevated and continues to underpin safe-haven demand for gold.
Additional support comes from renewed US dollar weakness, offering further tailwinds for precious metals. However, expectations that incoming Fed Chair Kevin Warsh may adopt a firmer policy stance could limit gold’s upside, suggesting traders should remain cautious before positioning for extended gains.
Create a live VT Markets account today to access our platform features, including market insights and educational content.
