Gold Price Forecast: Uncertainty Rises After Bearish Reversal

Author: Bruce Powers

Published: February 5, 2026

Overview

The gold market is currently facing heightened uncertainty following a significant bearish reversal observed last week. Prices have recently tested a well-defined support zone, prompting traders to watch for potential consolidation or a resurgence in upward momentum.

Market Movements

Gold prices reached a new retracement low of $4,402 on Monday, marking a four-week low. This level found support near the 50-day moving average, which is critical for future price movements. Following this, a bounce occurred, but resistance was encountered at $4,092 on Wednesday, with the market closing below the 10-day average.

Technical Analysis

First Pullback and Key Indicators

This week marked the first pullback after last week’s trend reversal. On Thursday, gold triggered a bearish reversal below Wednesday’s low, indicating weakness as it fell below the 20-day average. The 50-day average is now in sight, and another test of this line may occur. A dip that generates a higher swing low could lead to a second upward leg from the bottom.

Support Levels

Near-term support is identified at Tuesday’s low of $4,664, followed by the 50-day average at $4,530. There is also a possibility that gold may consolidate below the 10-day average and above the 50-day average.

Indicators Reinforcing Support

Several indicators suggest that the current support zone should hold for the time being. This includes the 50-day average and the confluence of two other indicators: the top of a previously resistant rising channel now acting as support, and the 88.6% retracement of the recent internal upswing at $4,425.

Short-Term Signals and Recovery Scenarios

In the short term, the relationship to the 20-day average, currently at $4,848, may provide insights. A successful rally above the day’s high could indicate strength, potentially leading to an advance above this week’s high. If the market were to close on a doji, it would confirm the prevailing uncertainty in the shorter timeframe. A breakout above this week’s high could set gold on a path to test the 78.6% retracement level at $5,342, which is the current upside target.

Conclusion

As the gold market navigates through this period of uncertainty, traders are advised to monitor key support levels and moving averages closely. The potential for a recovery remains, contingent on the market's ability to break through resistance levels and establish a new upward trend.