WASHINGTON, January 28, 2026 — Gold futures surged to a high of $5,303.89 on Wednesday, a jump fueled by a weakening U.S. dollar and raising questions about whether the rally can continue. The price increase, a 16.56% climb in just 11 days, has analysts watching for signs of a potential reversal, reminiscent of a similar peak experienced in April 2025 when former President Trump attempted to influence global trade without Congressional approval.
Gold’s Rally Faces Resistance Amid Dollar Concerns
A weakening dollar and upcoming Federal Reserve meeting are creating uncertainty in the gold market.
- Gold futures hit $5,303.89 on Wednesday, driven by a declining dollar.
- The Federal Reserve is expected to hold rates steady despite falling consumer confidence.
- Former President Trump has indicated he will soon name a new Fed chair, predicting lower interest rates.
- Technical analysis suggests a potential selling spree if gold fails to break $5,351.30.
Gold futures tested a day’s high of $5,303.89 on Wednesday and appeared poised to challenge the next resistance level. A failure to surpass the immediate resistance at $5,351.30 within the next four hours could signal the beginning of a selling spree, as the current rally is largely predicated on the dollar’s descent to near four-year lows following remarks made by Trump regarding the currency.
This move in gold comes just hours before a Federal Reserve meeting led by Chair Jerome Powell. The Fed is widely anticipated to maintain its current interest rate policy, even as consumer confidence slumped to its lowest level in over 11 years in January, reflecting growing anxieties about a slowing labor market and persistent high prices.
Trump has stated he will soon announce his pick for the next head of the U.S. central bank, and predicted that interest rates would fall once the new chair assumes office. While publicly downplaying concerns about the dollar’s decline, his actions suggest a strategy to stimulate the economy ahead of the November midterm elections, potentially by allowing the USD to slide and preempting any reluctance from the Fed to cut rates.
Some observers view this scenario as a politically motivated attempt to influence economic conditions, potentially overlooking the risk of surging inflation. Such a scenario could trigger a sharp decline in gold futures even before the Fed meeting concludes.
Technical Levels to Watch
In a daily chart, gold futures are expected to find support at $5,297.30 and may attempt to test the significant level of $5,351.30. A failed attempt to break this resistance could initiate a selling spree, potentially pushing futures down to test the immediate support at $5,229.37. If this support level is breached before the Fed meeting, a steeper decline is possible, with bears potentially driving a 75-degree downward trend.
A short position could be considered at $5,348 with a stop loss at $5,527.13, targeting $4,545.75 by February 11, 2026.
Disclaimer: Any position in gold carries risk, and this analysis is based solely on observations.
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