Spot gold traded lower on Thursday (February 12), currently hovering around $5,060 per ounce, down about 0.5% on the day. With mixed bullish and bearish signals, gold lacked sustained selling pressure and remained under pressure near its intraday lows during the European session. The unusually strong US non-farm payroll report for January, released overnight, cooled market expectations for more aggressive monetary easing by the Federal Reserve, triggering some selling of non-yielding gold.

The record-breaking non-farm payrolls data shattered hopes for a March rate cut, putting pressure on gold prices pending a breakthrough in CPI.

U.S. nonfarm payroll data for January showed an increase of 130,000 jobs, a significant rebound from the 50,000 jobs projected in December 2025, and exceeding market expectations of 70,000. Other details showed the unemployment rate fell slightly to 4.3% from 4.4%, while annual wage inflation—measured by changes in average hourly earnings—remained stable at 3.7%, higher than the market expectation of 3.6%. Traders reacted quickly; according to the CME Group's FedWatch tool, the market is now pricing in a probability that the Federal Reserve will keep interest rates unchanged in March, up from 80% in the previous trading day to around 95%.

Meanwhile, Cleveland Fed President Beth Hammark stated that the labor market appears to be approaching a healthy balance, making it crucial for the Fed to re-achieve its 2% inflation target. She added that policy rates are near neutral levels, and maintaining current rates is appropriate for the Fed. Furthermore, Kansas City Fed President Jeffrey Schmid pointed out that further rate cuts could lead to a prolonged period of high inflation.

The US dollar index is currently trading at 96.99 during Thursday's European session. The dollar index attempted to extend its rebound following the release of the non-farm payroll data, but bulls lacked sufficient confidence due to market expectations of two 25-basis-point rate cuts by the Federal Reserve this year (the first in July). Furthermore, the Fed's independence is under threat, limiting the dollar's upside potential and providing continued support for gold prices. Aggressive short sellers should remain cautious.

Market focus has now shifted to Friday's latest US consumer inflation data, which will provide further clues about the Federal Reserve's rate-cutting path and drive demand for the dollar. Meanwhile, the US weekly initial jobless claims data, to be released later Thursday, will offer opportunities for short-term traders. Overall, the supportive fundamental backdrop will continue to support gold.

Gold prices have stabilized above the 50% Fibonacci retracement level, indicating that bulls are in control.

The MACD histogram is oscillating around the zero line, indicating a neutral price trend. The Relative Strength Index (RSI) is slightly above the midline, showing a mildly bullish bias. On the 4-hour chart, the 200-period moving average (MA, 4756.29) is steadily rising, and gold prices are holding steady above this moving average, reinforcing the underlying positive tone. This moving average provides short-term dynamic support.

Using the recent high and low as a reference range, gold prices are currently trading between the 50% retracement level (around $5,000) and the 61.8% Fibonacci retracement level (around $5,140), with the latter acting as a resistance level. If gold prices break through this resistance level, they are expected to resume their upward trend.



(Spot gold 4-hour chart, source: FX678)

At 15:45 Beijing time, spot gold was trading at $5057.56 per ounce.