Gold (XAUUSD) Maintains Bullish Momentum Above $5,000 Ahead of PPI Data

Gold (XAUUSD) remains strong above $5,000 and appears to close the week at higher levels. Buyers are cautious ahead of US Producer Price Index data, which could influence short-term momentum. The metal remains attractive as macro risks remain high. Uncertainty about tariffs, geopolitics and stretched equity valuations are all continuing to support the bullish bias in gold market.

Macro Risks and Policy Uncertainty Support Gold Demand

Gold price remains strong as US trade policy is still unpredictable. According to US officials tariff rates on some countries might increase above 15% which indicates fresh uncertainty for markets. Due to sudden changes in trade rules, investors try to shield themselves from economic shocks. This uncertainty supports safe haven demand for gold.

On the other hand, geopolitical tensions also provide risk premium in global markets. The nuclear talks between the United States and Iran showed some progress, but there is still no final agreement. Investors are worried because the negotiations may easily stall or turn around. If risk of conflict remains, demand for gold will likely remain strong.

On the other hand, concerns over high valuations of technology stocks provide another layer of support for gold. When equity markets are overvalued, gold prices may be supported.

The chart below shows that the Coincident Economic Activity Index has dropped to 1.8%. This level is below the 2.5% that often signals weakening growth before a recession. This decline indicates that economic momentum in United States is slowing. When growth weakens, investors shift funds toward defensive assets. This shift increases demand for safe haven assets like gold.

At the same time, softer economic activity raises expectations of future Federal Reserve rate cuts, which reduces the opportunity cost of holding non-yielding assets. Therefore, the weakening economic activity adds another fundamental reason for gold to remain supported.

Bullish Technical Structure Points Toward Further Gold Upside

From technical perspective, the gold price remains in a strong bullish trend as seen by the daily chart below. The correction in January 2026 brought the gold price from the high of $5,600 to $4,400, within just three days. After dropping to this support, the price produced a sharp shadow on daily candle and reversed higher.

This level of $4,400 was defined by strong support at 50-day SMA, which has introduced a strong rebound and taken the prices back above $5,000. The recent breakout above $5,100 is creating another bullish move, which may take the gold price towards $5,600.

Moreover, the RSI has landed above the mid-level and is trending higher. This RSI move indicates that gold will likely continue higher. Moreover, the 50-day SMA and 200 SMA are trending upward, which suggests a strong bullish trend in the gold market.

The short-term structure of gold also remains strongly bullish as the price has broken the ascending triangle pattern in December 2025. After the breakout from this triangle, the price surged higher towards $5,600. The recent correction has taken the price back to the $4,400 support.

However, the gold price has found support at $4,400 and is showing strong bullish price action. The strong consolidation between $4,770 and $5,100, followed by breakout after this consolidation, indicates that the gold price is likely to continue strongly upward.

This bullish structure is also evident on the hourly chart, which shows the formation of an inverted head and shoulders pattern above $4,800. The price has broken the neckline of this head and shoulders pattern at $5,100 and is looking higher.

Bottom Line

Gold remains well-supported as macro and technical factors indicate higher prices. Policy uncertainty, geopolitical risks and slowing economic momentum keep safe haven demand strong. Expectations of potential Fed rate cuts also strengthened the gold price. At the same time, strong technical breakouts and steady momentum confirm bullish structure. Unless macro risks ease sharply or inflation data surprises strongly to upside, the overall bias for gold is likely to stay upward in the near term.

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