I. Price Action & Technical Analysis
SHFE Gold main continuous contract closed at CNY 679.42/g on February 26, 2025, down 1.0947% from CNY 685.58/g in the prior session, marking the largest single-day decline in the past five trading days. Daily volume reached 436,896 lots, a significant increase from 294,169 lots on February 25, while open interest fell to 128,465 lots, down a cumulative ~28.1% from 178,647 lots on February 20, showing a clear pattern of open interest cut on declining prices.
On the moving average system, MA5 stood at CNY 685.08/g and MA20 at CNY 674.46/g on February 26. The close of CNY 679.42/g broke below the 5-day MA but remained about CNY 4.96/g above the 20-day MA. The 20-day high H20 was CNY 691.76/g and the 20-day low L20 was CNY 639.30/g, leaving the current price in the upper-middle portion of the 20-day range. The pivot point P is CNY 680.19/g, first resistance R1 is CNY 685.77/g, and first support S1 is CNY 673.83/g; the close sat slightly below the pivot, indicating short-term weakness.
On the weekly chart, the week of February 20 closed at CNY 690.00/g, February 21 closed at CNY 684.44/g, and February 24–26 posted three consecutive closes below CNY 686/g, forming a rally-and-fade weekly pattern. On the monthly view, the 20-day MA rose steadily from CNY 665.66/g on February 20 to CNY 674.46/g on February 26, so the medium-term upward slope remains intact.
On indicators, RSI has retreated from overbought territory, with specific readings to be updated; the MACD histogram has narrowed versus prior periods, with the fast and slow lines still above the zero line, indicating weakening trend momentum but no bearish crossover; ATR, referencing the international contract GC=F at USD 40.3285, remains elevated, suggesting volatility has not yet converged.
Key level assessment: upside resistance lies at CNY 685.77/g (R1) and then CNY 691.76/g (20-day high); downside support lies at CNY 673.83/g (S1) and CNY 674.46/g (MA20), with a decisive break lower targeting the CNY 639.30/g (20-day low) zone.
II. Fundamental Drivers
On macro rates and the US dollar, international gold GC=F closed at USD 2,916.80/oz on February 26, up 0.42%, but the 5-day change was -0.09, showing an essentially flat week; the 20-day change was +5.42, still positive over the medium term. Domestic SHFE Gold fell 1.0947% the same day, a clear onshore-offshore divergence, likely driven by RMB exchange rate factors and convergence of the domestic premium; specific FX data to be updated.
On inflation and policy expectations, market pricing of major central bank rate paths remains the core anchor for gold. If real rates stay elevated, the opportunity cost of holding gold rises and caps upside; if rate-cut expectations rekindle, gold should find support. No specific rate or inflation readings are provided in the current data; related judgments to be updated.
On inventories and central bank buying, this report provides no SHFE gold inventory or global monthly central bank purchase data; to be updated. Historically, central bank buying has been a key structural force lifting the gold price center of gravity, but its pace is low-frequency and non-public, limiting short-term impact on the tape.
On ETFs and investment demand, no SPDR or other gold ETF holding changes are provided; to be updated. On open interest, SHFE Gold main contract OI fell from 178,647 lots on February 20 to 128,465 lots on February 26, a clear outflow of funds, possibly reflecting profit-taking by some longs.
On geopolitics, domestic headlines over the past 48h returned N/A, with no usable sentiment data, so the immediate price impact of geopolitical events cannot be quantified; to be updated. Overall, fundamentals show a mix of bullish and bearish factors with no clear one-way driver in the short term.
III. Positioning & Fund Flows
On COT data, the latest record provided is dated 2026-09-15, a clear time mismatch versus the report date of 2025-02-26; this dataset is not usable for the current period, and current-period COT breakdowns are to be updated. Referencing the structural characteristics of this historical record: total OI was 409,999, longs L were 142,394, shorts S were 9,278, net longs net were 133,116, with a weekly change Δ of -1,856; net longs declined for three consecutive weeks (-1,799, -7,976, -1,856), indicating speculative longs were gradually cutting positions.
For SHFE Gold itself, open interest on February 26 was 128,465 lots, down 29,171 lots from 157,636 lots on February 25, a single-day drop of about 18.5%, a sizable open interest cut; volume rose to 436,896 lots, and the combination of rising volume with falling open interest typically points to long liquidation rather than new short entry.
On crowding, measured as net longs as a share of total OI, the reference data show net/OI at about 32.5%, a relatively high level, implying risk of crowding mean-reversion. Options and volatility data were not provided this time; implied volatility and skew to be updated. The ATR reference of USD 40.3285 shows realized volatility remains high; if ATR subsequently falls, prices may enter a range-bound consolidation.
IV. Cross-Asset Relative Value
On the gold-silver ratio, no silver price is provided; the ratio and its historical percentile are to be updated. Generally, a rising gold-silver ratio reflects safe-haven dominance and weak industrial attributes, while a falling ratio signals recovering risk appetite.
On the oil-gold ratio, no crude price is provided; the ratio and percentile are to be updated. The oil-gold ratio is an important gauge of inflation trades; if it rises, warming inflation expectations may be gold-supportive.
On the copper-gold ratio, no copper price is provided; the ratio and percentile are to be updated. The copper-gold ratio is often viewed as the relative pricing of growth versus safety; a declining ratio tends to coincide with rising growth concerns and relative gold outperformance.
The usable cross-market comparison is the onshore-offshore gold price: GC=F closed at USD 2,916.80/oz on February 26, up 0.42%, while SHFE Gold main contract closed at CNY 679.42/g, down 1.0947%. The two moved in opposite directions; if the domestic premium narrows after FX conversion, it suggests the previously excessive domestic premium is being repaired; if FX factors dominate, the RMB central parity must be considered for further judgment, with FX data to be updated. Overall, usable cross-asset relative value information is limited this time; the onshore-offshore spread and exchange rate are recommended as alternative observation windows.
V. Sentiment
On sentiment scores, no quantitative sentiment indicator was provided; sentiment score to be updated. Domestic headlines over the past 48h (market=CN, asset=GOLD) returned N/A, with no usable headline bias statistics; sentiment direction to be updated.
Inferring indirectly from price action: SHFE Gold fell 1.0947% on heavy volume with a sharp drop in open interest on February 26, indicating cautious short-term sentiment; however, international GC=F rose 0.42% the same day, with chPos at 78.20%, down notably from 95.50% on February 24, showing reduced concentration of international longs and sentiment shifting from euphoric to neutral. Overall, sentiment is in a watchful phase after retreating from highs; absent new catalysts, sentiment alone is unlikely to drive a trend.
VI. Historical & Seasonal Patterns
On seasonality, no return distribution data for the same period over the past 10 years (late February to early March) for SHFE Gold or international gold prices was provided; seasonal statistics to be updated. By general experience, February–March is a transition between the post-Chinese New Year consumption off-season and the Indian wedding season, so marginal physical demand support for prices usually weakens.
On event patterns, the domestic financial calendar for the next 7 days returned N/A, so no historical event study can be based on calendar events; event-window statistics to be updated.
On volatility patterns, GC=F ATR is USD 40.3285, with a 20-day gain of +5.42 and a 5-day gain of -0.09, a combination of “medium-term uptrend, short-term stall.” Historically, after this combination appears, prices often enter several days to two weeks of consolidation, with subsequent direction depending on macro catalysts. This is an empirical description, not a deterministic judgment.
VII. Long-Short Scenario Analysis
Bull case: first, SHFE Gold closed at CNY 679.42/g, still above MA20 at CNY 674.46/g, so medium-term MA support is unbroken; second, the cumulative gain from the 20-day low of CNY 639.30/g to the current price is substantial, and the trend structure has not reversed; third, international GC=F closed up 0.42% on February 26 with a 20-day change of +5.42, showing medium-term offshore strength; fourth, after the sharp drop in open interest, floating supply has decreased, so if prices stabilize, rebound resistance should ease.
Bear case: first, the single-day drop of 1.0947% on February 26 broke below MA5 at CNY 685.08/g, turning the short term weak; second, open interest fell from 178,647 lots to 128,465 lots, with funds exiting continuously; third, the close of CNY 679.42/g is below pivot P at CNY 680.19/g, a short-term bearish signal; fourth, GC=F chPos fell from 95.50% to 78.20%, so while long crowding has eased it remains high, leaving room for further position cuts.
Short- versus medium-term balance: short term (1–5 days) bears hold a slight edge, as price broke below the 5-day MA and the pivot; medium term (1–4 weeks) bulls and bears are balanced, with the 20-day MA and the 20-day low forming support below—if the CNY 674/g line holds, the range-bound pattern continues, but a loss would strengthen the bears. Overall judgment is high-level consolidation, with directional choice awaiting new macro catalysts.
VIII. Trading Strategies & Risk Management
Strategy 1 (Range Low-Absorption, LONG): Entry reference CNY 674–676/g area (near MA20 at CNY 674.46/g and S1 at CNY 673.83/g), stop-loss set below CNY 668/g, targets at CNY 685–686/g (near MA5 and R1), horizon 1–5 trading days, position size recommended at no more than 15% of total capital, conviction 6. If price effectively breaks below CNY 673.83/g and closes beneath it, this strategy is invalidated and positions should be exited to the sidelines.
Strategy 2 (Rebound Short-Selling, SHORT): If price rebounds to the CNY 685–686/g area (MA5 at CNY 685.08/g and R1 at CNY 685.77/g) and meets resistance, a light short can be attempted; entry reference CNY 685–686/g, stop-loss set above CNY 692/g (above the 20-day high of CNY 691.76/g), targets at CNY 675–676/g, horizon 1–5 trading days, position size recommended at no more than 10% of total capital, conviction 5. If price breaks above CNY 691.76/g on rising volume, this strategy is invalidated.
Risk Management: Current ATR reference USD 40.3285, with volatility on the high side; single-trade stop-losses should not be too tight. With open interest in a sustained decline, trend-following win rates are falling, so range strategies are preferred. Strictly enforce stop-losses and avoid heavy positioning in a data-sparse environment.
IX. This Week's Data Calendar
The domestic financial calendar for the next 7 days returned N/A; the specific event table is pending update. Suggested focus: remarks by major-economy central bank officials, inflation and employment data releases, moves in the US dollar index and US Treasury yields, and the breakout direction of international gold price GC=F within the USD 2,900–2,950/oz range. Any surprise data could break the current range-bound pattern.
This report is generated automatically from public quantitative and macro data for research and market tracking only. It does not constitute any investment advice.