Gold and silver prices are facing downward pressure this week as the US dollar rebounds and risk appetite returns to global markets. Following a sharp rally that took gold to an all-time high of $3,500, the precious metal has entered a correction phase, pulling back to test support zones amid a stronger greenback and higher Treasury yields.
Gold Price Technical Analysis
Daily Chart Overview Gold (XAU/USD) prices have corrected from the critical $3,500 resistance level and are now stabilizing near the $3,200–$3,150 support zone. This level marks the upper edge of the long-term ascending price channel and coincides with the 50-day simple moving average (SMA) around $3,090, offering significant technical support.
4-Hour Chart Outlook Despite the recent sell-off, gold maintains a bullish structure on the 4-hour chart. Price action remains inside an ascending channel, with the correction from $3,500 pointing to $3,150 as a key short-term support level. Volatility remains elevated, but the bullish channel supports a potential rebound if buyers step in.
Silver Price Technical Analysis
Daily Chart Overview Silver (XAG/USD) remains strong above its 200-day SMA, currently consolidating above $30. The technical outlook suggests a breakout above $35 could lead to further gains targeting $43 and even $50 in the medium term.
4-Hour Chart Outlook Silver has formed a double bottom near $28 and is now consolidating above $31.80. This bullish reversal pattern suggests buyers are likely to support prices on dips, with $35 remaining the key resistance level to watch.
US Dollar Index (DXY) Technical Analysis
Daily Chart Overview The US Dollar Index has rebounded from the critical 98 support level, targeting the 100.65 resistance area. A breakout above this level could open the door to further upside toward 103. However, a drop back below 98 could trigger a slide to 96, reaffirming bearish pressure.
4-Hour Chart Outlook On the 4-hour chart, the DXY has formed an inverted head and shoulders pattern and is approaching resistance at 101. This level aligns with the daily resistance at 100.65. A successful breakout could lift the dollar toward 102.75 in the short term.
Macroeconomic Drivers
Recent risk-on sentiment, fueled by easing US-China trade tensions and positive equity market performance, has weighed on gold and silver. The exemption of certain auto tariffs by the Trump administration and progress in trade talks have improved investor confidence.
However, underlying macroeconomic data remains weak:
- US Q1 GDP contracted unexpectedly
- Weekly jobless claims rose to 241K, higher than the forecasted 224K
- Manufacturing activity remains in contraction
These concerns raise the likelihood of an economic slowdown, which could eventually support renewed demand for precious metals.
Outlook for Gold and Silver
With Friday’s US Nonfarm Payrolls (NFP) report on the horizon, traders are closely watching for signs of labor market weakness. A disappointing jobs report could push the Federal Reserve toward rate cuts, potentially weakening the dollar and boosting demand for gold and silver.
Key Support Levels:
- Gold: $3,200, $3,150, $3,090
- Silver: $31.80, $30.00
Key Resistance Levels:
- Gold: $3,370, $3,500
- Silver: $35.00, $43.00
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