Gold and Silver Technical Outlook: Consolidation Hints at Next Major Move Amid Global Risks

Gold prices rebounded on Friday, climbing above $3,300 after reversing Thursday’s losses. The surge came amid renewed volatility sparked by escalating geopolitical tensions across Ukraine, the Middle East, and the India-Pakistan border. These conflicts continue to drive demand for safe-haven assets like gold, although upside potential remains limited due to improving trade sentiment and a stronger U.S. dollar.

The announcement of a limited U.S.-U.K. trade deal briefly lifted investor sentiment, but with a 10% tariff on most goods still in place, market optimism remains cautious. Meanwhile, news that the U.S. may cut tariffs on Chinese goods from 145% to 50% ahead of upcoming Switzerland trade talks offers further hope for de-escalation, contributing to modest downward pressure on gold.

However, the U.S. dollar gained ground after the Federal Reserve adopted a hawkish tone, signaling no immediate interest rate cuts. The DXY surged to a one-month high, reducing the appeal of non-yielding assets like gold and silver. Markets now await comments from key FOMC members for clearer guidance on rate policy.

Despite trade-related optimism, geopolitical instability remains the key driver of safe-haven flows, keeping gold supported in the near term.

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Gold Technical Analysis

Daily Chart – Resistance Holds, Support in Focus

Gold is currently trading below the resistance zone at $3,370, having faced rejection at that level. Strong support is identified between $3,100 and $3,200, with the broader pivot zone sitting at $2,900 to $3,000. The overall trend remains bullish, and a confirmed breakout above $3,500 could trigger a rally toward the $4,000 level.

4-Hour Chart – Bullish Channel Intact

The 4-hour chart shows consolidation around $3,280, aligning with the support of the ascending channel. The bullish trend remains intact, and gold is likely to stabilize before making its next move.

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Silver Technical Analysis

Daily Chart – Eyes on $35 Breakout

Silver continues to consolidate above its 200-day SMA, signaling strength. The price structure supports a move toward the $35 resistance level. A breakout above this could open the path toward the $42 area. Key support lies between $28 and $31.

4-Hour Chart – Double Bottom Forming

Silver’s 4-hour chart shows a potential double bottom pattern around the April and May lows. A break above $34.50 will confirm the bullish continuation.

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US Dollar (DXY) Technical Analysis

Daily Chart – Still Bearish Below 103

The U.S. Dollar Index rebounded from the long-term 98 support and reached 100.65. However, it faces resistance at the 50-day SMA near 101.80. The downtrend remains dominant unless the index breaks decisively above 103.

4-Hour Chart – Inverted Head & Shoulders in Play

An inverted head-and-shoulders pattern has emerged on the 4-hour DXY chart, with a break above 100.50 now targeting 101.80. For further upside, bulls need a breakout from the descending channel.

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Conclusion

Both gold and silver remain in consolidation, supported by geopolitical risk but capped by rising trade optimism and a stronger dollar. With crucial trade talks and FOMC commentary ahead, volatility is likely to increase. Watch for breakouts above $3,500 in gold and $35 in silver to confirm bullish extensions.

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