Weekly Gold (XAU/USD) Forecast: US-Iran Standoff Trumps US PPI, Setting Stage for $5300/oz
By Zain Vawda | 27 February 2026
Market Overview
Gold prices have surged above the $5200/oz mark, marking a potential seventh consecutive monthly gain. This rally is largely attributed to increased haven demand driven by escalating geopolitical tensions, particularly concerning the US-Iran situation. Despite a hot US Producer Price Index (PPI) report, which initially bolstered the US Dollar, the DXY index has since declined, indicating a shift in market sentiment favoring gold.
Geopolitical Factors
Recent developments suggest a possible imminent US military action against Iran, prompting heightened geopolitical risk. Reports indicate that the US State Department has ordered the evacuation of non-essential personnel from its embassy in Baghdad, and Chinese authorities have advised their citizens to leave Iran and Israel. These factors have contributed to a surge in haven demand for gold.
Economic Indicators
Looking ahead, key US economic data releases, including the ISM Manufacturing and Services reports and the Non-Farm Payroll (NFP) jobs report, are expected to influence the US Dollar. The ISM reports are anticipated to show a slight softening in economic activity, while the jobs report is projected to reveal a narrow expansion in employment, with the unemployment rate expected to rise to 4.4%.
Technical Analysis
From a technical perspective, gold is maintaining a bullish trajectory. A weekly close above the $5200/oz level is crucial for sustaining this momentum, with resistance levels at $5249/oz and $5300/oz. Should geopolitical tensions escalate, these levels could be surpassed, with further resistance at $5337 and $5400. Conversely, downside support is identified at $5150/oz, with a potential drop towards the February 24 low of $5093/oz if this support fails.