From February 2 to February 10, COMEX gold futures demonstrated a strong trend characterized by a "dip and rebound" pattern followed by high-level consolidation, with its price center shifting significantly upward. The price successfully broke through and stabilized above the key psychological level of $5,000 per ounce. Key drivers behind this movement included rising geopolitical避险 sentiment, a weakening U.S. dollar, and intensified trading activity between bullish and bearish positions. During this period, gold hit a low of $4,400 per ounce on February 2 before staging a rapid rebound.
On February 3,避险 buying surged due to escalating geopolitical risks, driving a strong rebound that pushed gold toward the $5,000 mark. By February 10, after further consolidation at elevated levels, the price briefly climbed to $5,100 per ounce. As of 23:10 on February 10, COMEX gold settled at $5,085 per ounce. Geopolitical tensions were identified as the primary catalyst for the rally, while dollar weakness provided indirect support, contributing to the overall upward shift in price levels.
Tensions between the U.S. and Iran intensified. On February 10, Iranian Air Force Commander Amir Vahedi announced that the country's air force was at its highest level of combat readiness, citing valuable experience from past conflicts that helped reshape operational capabilities against modern threats. Vahedi emphasized that Iran is fully prepared to respond decisively to any act of aggression.
Separately, the Israeli Prime Minister's Office disclosed on February 7 that Prime Minister Netanyahu would meet with U.S. President Trump on February 11 to discuss negotiations concerning Iran, advancing the originally scheduled meeting by at least a week. On February 9, the U.S. Maritime Administration issued guidance advising U.S.-flagged commercial vessels to steer clear of Iranian territorial waters and to verbally refuse any boarding requests by Iranian forces.
Meanwhile, representatives from Russia, Ukraine, and the U.S. held closed-door talks in Abu Dhabi from February 4 to 5, focusing on territorial disputes, ceasefires, and security guarantees. While the Ukrainian side described the talks as "productive," core disagreements remained unresolved. Russia stated that the "door to peace remains open" but military operations continued, and the U.S. noted a reduction in outstanding issues while acknowledging persistent key differences.
Shortly after the trilateral talks concluded, conflict between Russia and Ukraine reignited. On February 7, Ukrainian President Zelensky reported that Russian forces launched a new wave of airstrikes using over 400 drones and nearly 40 missiles, primarily targeting Ukraine's power grid, generation facilities, and substations. Rescue and repair efforts are ongoing.
He Yan, an analyst at Chuangyuan Futures, noted that since the onset of hostilities between Russia and Ukraine, two rounds of talks have been held in Abu Dhabi in 2026—on January 23 and February 4—yet no consensus has been reached on core issues, particularly regarding territory and post-war arrangements for Ukraine. He suggested that a near-term easing of tensions is unlikely, though U.S. intervention could increase the probability of a ceasefire agreement this year.
Shen Jingcai, a senior gold analyst, highlighted that the recent rally in gold and silver futures is not solely attributable to stalled U.S.-Iran negotiations. Instead, it stems from a combination of factors: reinforced expectations for Federal Reserve interest rate cuts, a weaker dollar, geopolitical risks (including the U.S.-Iran stalemate), technical indicators, and physical buying interest.
Shen pointed to weak U.S. employment data, which has fueled market bets of a Fed rate cut in June with a probability exceeding 50%, depressing the dollar index and enhancing the appeal of precious metals. Silver, having rebounded from previous sharp declines, broke through key resistance levels with amplified trading volumes, indicating strong capital inflow. Tight COMEX silver registered inventories and delivery expectations also contributed to silver's rise, signaling ongoing instability in risk assets that may drive investors toward避险 alternatives.
Notably, as international gold prices continued to fluctuate, the Chicago Mercantile Exchange (CME) repeatedly raised margin requirements, drawing widespread criticism. Zhang Yingying, Deputy Director of Derivatives at COFCO Richfield (Beijing) Trading, explained that the increases are intended to raise participation thresholds, curb excessive speculation, and stabilize price volatility.
Zhang noted that while margin hikes—applied equally to long and short positions—initially place greater pressure on short sellers due to additional funding requirements, such risk controls ultimately promote market rationality and healthy operation over the long term.
Since early January 2026, CME has implemented four key risk control measures for gold and silver futures, including one mechanism conversion and three margin increases. Shen Jingcai emphasized that the exchange's objective is to manage extreme volatility, reduce leverage, ensure clearing safety, and cover tail risks. The measures are neutral in design, impacting both long and short positions, and primarily affect highly leveraged traders.
However, Shen observed that in practice, the sudden margin hikes have forced many retail investors with concentrated long positions to liquidate at low levels amid rising prices, accelerating price declines and causing significant losses for bullish traders. In contrast, well-capitalized institutions and short sellers may benefit from the resulting sell-offs, leading to discontent among retail participants.
Attention is also turning to the U.S. Supreme Court's pending ruling on policies related to former President Trump. The court began a mid-term recess on January 21 lasting approximately four weeks, with a decision expected around February 20, coinciding with the Chinese Lunar New Year holiday. Zhang Yingying cautioned that while betting markets currently assign less than a 50% chance of a favorable outcome for Trump, an unexpected ruling could reignite "de-dollarization" narratives, triggering sharp short-term volatility in gold.
He Yan added that despite generally strong U.S. economic data, the upcoming non-farm payrolls report on February 11 represents a critical variable. With the Fed potentially adopting a meeting-by-meeting approach to policy decisions, Chair Powell is likely to maintain a data-dependent stance. Market consensus currently leans against a rate cut at the next meeting, though uncertainty remains ahead of the jobs data release.
As gold price volatility persists, Shen Jingcai advised investors to monitor key factors including Fed policy, economic data, exchange risk controls, fund flows, supply-demand dynamics, and geopolitical sentiment. He stressed the importance of controlling leverage and position sizes to avoid being forced out by short-term swings, recommending maintaining 50% cash reserves to meet margin calls or price corrections and setting stop-loss orders in advance.
With the Lunar New Year approaching and gold prices oscillating at high levels, the question of whether to buy gold arises. Zhang Yingying noted that physical gold, as the underlying asset for all gold financial derivatives, offers both value preservation and collectible appeal, making it more suitable for general consumers than financial products. She highlighted that domestic services such as buy-backs and trade-ins have improved, enhancing liquidity and reducing consumer concerns.
Shen Jingcai, however, advised that purchasing decisions should align with individual goals. If buying for gifting, wedding purposes, or personal wear—essentially rigid demand—acquisition can proceed regardless of timing. Currently, international gold prices are hovering around $5,000 per ounce, with domestic prices also elevated; for example, the Shanghai Gold Exchange's T+D contract was quoted near 1,118 yuan per gram on February 10, 2026. Branded gold jewelry retails at even higher prices, typically between 1,480 and 1,560 yuan per gram. While prices have retreated from late-January highs, they remain relatively elevated.
For investment purposes, Shen recommended a rational approach and appropriate vehicle selection. Long-term investors may prefer bank-sold investment gold bars, which carry lower premiums than jewelry and offer standardized liquidation channels. Alternatives include gold accumulation plans or gold ETFs. He advised against lump-sum investments, suggesting dollar-cost averaging instead, and emphasized keeping gold exposure as a moderate portion of overall asset allocation.
Regarding gold's outlook, Mark Haefele, Chief Investment Officer at UBS Global Wealth Management, wrote in a report that recent volatility has raised doubts about gold's role as a hedge against geopolitical and market turmoil, but such concerns are overstated, and the upward trend should resume. David Wilson of BNP Paribas projected that gold could climb to $6,000 per ounce by year-end amid persistent macroeconomic and geopolitical risks, with the gold-silver ratio expected to rise.
Zhang Yingying added that after sharp swings between December and January, volatility in gold and silver has moderated somewhat, though both absolute prices and implied volatility from options markets remain high. Bullish sentiment persists, and over a one-year horizon, prices may enter a period of high-level consolidation similar to patterns seen in 2011 and 2020.
Shen Jingcai also suggested that gold prices are likely to maintain high-level volatility during the Lunar New Year period. Although short-term profit-taking pressure exists, solid physical demand and rate-cut expectations should limit further significant declines. Post-holiday, improved liquidity and potential rate cuts could support medium- to long-term gains, albeit with heightened volatility.