On February 20th, as geopolitical tensions in the Middle East escalate once more, the precious metals market appears to be in a period of quiet before a potential surge. Analysts at FPG CaSheng International indicate that market participants are intensely focused on the dynamics of U.S. military deployments in the region, with this highly tense external environment providing solid underlying support for gold and silver. Data shows April gold futures recently hovering above $5,018, while March silver futures have steadily climbed to the $78 mark. Although short-term gains have moderated, market sentiment remains predominantly cautious, awaiting the possibility of regional conflict translating into concrete action.
Regarding the deepening evolution of geopolitical maneuvering, FPG CaSheng International suggests the scale of any potential military conflict could significantly exceed previous episodes. Based on aggregated reports from multiple international media outlets, U.S. military pressure in relevant areas has reached a critical level, increasing the likelihood of joint U.S.-Israel operations. This uncertainty not only impacts the geopolitical landscape but also directly interferes with the pricing logic of commodities. Simultaneously, spillover effects are evident in the energy market, with crude oil prices touching an eight-month high, trading near $66.50 per barrel. This transmission of inflation expectations further complicates the trajectory for precious metals.
On the monetary policy front, the Federal Reserve's recent hawkish stance is creating a tug-of-war with safe-haven flows driven by geopolitical concerns. The hawkish signals from the January meeting minutes are significant, revealing policymakers' dissatisfaction with the pace of disinflation. This suggests the Fed is gradually ruling out near-term interest rate cuts and is even prepared to resume hikes if necessary. The 10-year U.S. Treasury yield is currently holding around 4.1%, which somewhat caps the upside potential for gold and silver. FPG CaSheng International notes that gold is currently seeking equilibrium near the $5,000 psychological level, while silver is experiencing rotational consolidation within a technical range of $78 to $80.
From a technical perspective, the next strategic objective for gold bulls is a sustained break above the $5,250 resistance level. The bullish outlook for silver points towards a target of $90. Although the Fed's policy shift introduces challenges, the "black swan" risk associated with geopolitics remains the core source of premium for precious metals. FPG CaSheng International advises investors to closely monitor substantive developments in the situation over the coming weekend. In a 2026 landscape characterized by concurrent global debt risks and geopolitical friction, the defensive, safe-haven attributes of gold and silver are expected to continue attracting market capital.