Gold & Precious Metals slide: Iran diplomacy and Lunar New Year drain liquidity

Ben Graham · February 17

Happy Lunar New Year! Many Asian nations and people celebrate the beginning of the year of the Fire Horse, taking many essential commodity Markets off for this week.

As detailed in our past day's Oil outlook, China being off can amplify moves in commodity markets, as the Shanghai Futures Exchange (where most Asian trading for metals occurs) is closed for the entire week, leading to thinner markets.

After a long US weekend, traders are unloading their risk hedges amid mostly positive communications regarding the second round of US-Iran talks in Geneva.

Iranian Foreign Minister Abbas Araghchi communicated a potential exchange of documents, which follows the more recent narrative of higher odds of a deal, expressed by Israeli PM Netanyahu on his way back from the White House.

One of the key reasons for Metals to rally exponentially at the beginning of 2026 was the sudden pricing in of a potential significant conflict in the Middle East after brutal repressions and tragic death tolls from the Revolts.

Combined with the conclusion of a very positive seasonal month for Metals, February came with a cold wind for precious commodity bulls.

Gold & Precious Metals slide: Iran diplomacy and Lunar New Year drain liquidity - ExpertFX School — Metals performance in 2026 – Source: TradingView. February 17, 2026

While Gold remains on top, Silver and other, more volatile and less safe-haven metals are getting rejected quite starkly. Note that Platinum seems quite resilient above $2,000, so keep an eye on this one.

With positioning getting to extremes (as expressed in a recent Bank of America Survey), options amassing for $15,000 - $20,000 prices in Gold (typical of Market tops), and fundamentals not warranting a continuous, clear-cut path to doubling prices, metals could be facing a fragile outlook ahead.

Of course, with a second US warship heading to the Middle East, which should arrive in about a week, it will be challenging to say. Geopolitics are all about deception, particularly in the age of information.

But in the meantime, with US Rates not expected to change until at least May, dollar positioning at its lowest, and Metals overcrowded, the narrative seems to be turning for Markets, may it be for AI or metals.

After a year-long straightforward Debasement Trade, things could suddenly not be so easy.

Let's dive right into an in-depth look at Gold as traders prepare for a heavy slate of Macroeconomic data throughout the week.

Gold Multi-Timeframe Technical Analysis

Daily Chart

It would be too early to say that the Bullion is entering a full-on bear market. However, signs of a significant momentum cooling are unfolding.

XAU is rejecting not only its essential $5,100 resistance but also is accompanied by a descending trendline, having broken its triangle formation to the downside.

The Daily RSI is also moving in that direction, looking poised to cross the bearish mid-level soon.

Taking a step back, Gold is simply rejecting its upside breakout and reverting to a more stable, continuous bull channel it has followed since 2024, which can provide more sustainable entry levels.

Dip-buyers will want to pay close attention to the 50-Day MA ($4,657), which acted as key support throughout the entire bull trend. A rebound there should see continuation. But watch out if prices actually close below on any session.

4H Chart and Technical Levels

We can see further details of the triangle breakdown, confirming the lower momentum in Gold.

Still, the pivot zone if coming in as a huge test for what's coming, particularly as the 4H 200-MA acts as its final support ($4,812) – Any 4H close below should lead to at least a retest of the February support $4,400.

Levels to watch for Gold (XAU/USD):

Resistance Levels:

$5,100 key Resistance
4H 50 MA $5,000
Current All-time Highs – $5,500 to $5,600
$5,400 mini-resistance

Support Levels:

4H 200-MA $4,812
Pivotal Support $4,400 to $4,500
$4,100 Main Channel Support lows
Main Support $3,880 to $4,050
$3,200 to $3,500 Major Support

1H Chart

On the intraday timeframes, Gold is expressing quite some hesitancy, with the RSI and Price Action mean-reverting. An intraday bear channel is now building.

The session lows will be acting as key indicator for the coming session. Closing below will first test the 200 4H-MA, while breaking it points to further downside.

Safe Trades!

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