Gold and Silver Outlook Steady as Traders Await Key US PCE Inflation Data

Highlights:

Gold price (XAU/USD) holds steady above the $3,300 support zone amid consolidation.
Silver (XAG/USD) finds strong footing near $35.30, showing potential for further upside.
US Dollar Index (DXY) continues to slide below the 98.00 mark, increasing pressure on the greenback.
Investors await the US PCE inflation report, which could spark a breakout in precious metals.

Gold and Silver Price Analysis: Calm Before the Potential Storm

Gold (XAU/USD) is trading in a tight range above the critical $3,300 support level, reflecting a cautious tone across the market as traders turn their attention to Friday’s PCE inflation release. Despite ongoing US Dollar weakness, gold failed to extend gains, with risk-on sentiment in equity markets reducing safe-haven demand.

Similarly, silver (XAG/USD) has also entered a consolidation phase after testing support near $35.30. While the weaker dollar offers some cushion, lack of a strong catalyst is keeping bulls on the sidelines for now.

Fundamental Focus: Fed Policy, Inflation, and Market Sentiment

The precious metals market remains highly sensitive to macroeconomic data and Fed policy signals. Traders are closely monitoring the dialogue between President Trump and Fed Chair Powell. Concerns about Fed independence and rising speculation around a possible September rate cut continue to influence sentiment.

The spotlight now shifts to the US Core PCE Price Index, the Fed’s preferred inflation gauge, due Friday. A softer reading could revive rate cut expectations and accelerate gains in both gold and silver. Conversely, stronger inflation could delay Fed easing and limit any bullish breakout.

Gold Price Technical Outlook

Daily Chart (XAU/USD):

Gold is hovering near the $3,300 mark, supported by the 50-day SMA. The metal remains inside a larger ascending triangle formation.

Immediate support: $3,280
Breakdown below $3,280 may trigger deeper losses toward $3,245 or $3,210.
Upside resistance: $3,450 – a confirmed breakout above this could open doors to retest $3,500.

4-Hour Chart (XAU/USD):

Gold is consolidating inside a descending channel. Price action suggests a potential rally if $3,400 is broken.

Bullish continuation: Only if price holds above $3,280 and breaks through $3,400.
Neutral zone: Between $3,280 and $3,450.

Silver Price Technical Outlook

Daily Chart (XAG/USD):

Silver remains firm after bouncing from the $35 area. Price is currently consolidating near $36.00 with upside potential.

Key support: $34.00–$35.00
Next resistance zone: $38.00, if momentum builds above $36.80

4-Hour Chart (XAG/USD):

The price is consolidating near key resistance at $37.30. A breakout above this level would signal a bullish extension toward $38 and beyond.

US Dollar Index (DXY) Technical View

Daily Chart (DXY):

The DXY remains under pressure, trading below both the 50-day SMA and the key 98.00 support level.

Major support: 96.00
Next downside target: 90.00, if bearish momentum intensifies.

4-Hour Chart (DXY):

The index is locked in a descending channel with repeated failures to reclaim the 99.30 zone. Continued weakness toward 95.00 may reinforce further USD declines.

Bottom Line

Gold and silver remain in consolidation mode, with traders awaiting a decisive catalyst from the upcoming US PCE inflation data. A dovish signal from the Fed could send both metals soaring, while a hawkish tone may delay the next leg higher. Until then, consolidation zones will define near-term trading setups.

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Yasher Rizwan