Gold and Silver Analysis: Geopolitical Risks and Weak Dollar Drive Bullish Momentum
By Muhammad Umair | Published: Feb 25, 2026
Key Points
- Gold rebounds from $5,090 and approaches $5,200 due to geopolitical risks and a weaker US dollar.
- Silver follows gold's strength, with support above $72 and pressure near $90 indicating continued upside momentum.
- Despite Fed signals, trade tensions, growth concerns, and dollar weakness maintain a bullish bias for both metals.
Gold Market Overview
The price of gold (XAU) has turned upward from a support level of $5,090, nearing $5,200 during Asian trading hours. This positive momentum is largely driven by safe-haven demand amid geopolitical tensions, particularly surrounding US-Iran nuclear discussions and military activities in the Middle East. Investors are increasingly seeking gold as a protective asset against potential market shocks, further supported by a decline in the US dollar index.
Silver Market Overview
Silver (XAG) typically mirrors gold's performance during risk-off periods. The rising geopolitical tensions have led to increased demand for both precious metals, with silver acting as a secondary safe-haven asset. As fears escalate, investments in precious metals are likely to rise, exerting upward pressure on silver prices.
Impact of Federal Reserve Policy
While the Federal Reserve's policy remains a potential headwind for gold and silver, its impact appears limited at this time. Fed officials have indicated no immediate plans to cut interest rates due to persistent inflation. Higher interest rates generally exert downward pressure on gold and silver; however, ongoing trade policy risks and global growth concerns continue to support bullish sentiment for these metals.
Technical Analysis of Gold
The daily chart for spot gold indicates strong bullish activity, having broken above the $5,090 level. Following this breakout, the price surged to $5,250 before correcting back towards $5,090. A sustained move above $5,250 could signal further upside towards $5,600, while a drop below $5,090 may lead to a decline towards $5,000. As long as the support at $4,400 holds, the outlook for gold remains positive.
Technical Analysis of Silver
Silver has shown robust bullish momentum, rebounding from the $72 support level and now challenging the $90 mark. A breakout above this level could indicate further upside towards $100. The formation of bullish hammer candles above the $64 support region suggests continued upward momentum in the silver market.
US Dollar Index Analysis
The positive price action in gold and silver is attributed to the weakness in the US dollar index, which is currently trading below its 50-day simple moving average (SMA). The long-term consolidation between 96.50 and 100.50 is expected to conclude soon, with a break below 96 indicating further downside towards 90. Conversely, a recovery above 98.50 could push the index towards 100.50.
Conclusion
Gold and silver prices are being supported by geopolitical risks, tariff uncertainties, and a weak US dollar, which continue to drive safe-haven demand. Gold remains above the critical support level of $5,090, with a bullish structure intact. Silver is also showing strength above $72, with upward pressure near $90 indicating potential for further gains. While Fed policy poses a challenge, the overarching sentiment remains bullish as long as the dollar index remains weak and key support levels for both metals hold.