Short-term Breakout Close at Hand

Since a dashed resistance trendline is close to crossing a lower solid rising trendline, volatility should expand soon as one of the lines will be broken by July 18. Those lines form a small symmetrical triangle. Their convergence shows volatility declining, which can also be seen in the 20-Day MA and 50-Day MA moving closer to one another.

Correction Reflecting Underlying Strength

Gold is trading within a pennant consolidation pattern around the highs of the long-term bull trend. It indicates the potential for an upside breakout, with a likely new record high to follow. Following the $3,500 record high in April, gold weakened with a bearish retracement. Support for the decline was seen at around both a 38.2% Fibonacci retracement level and the 50-Day MA. The bounce off the 50-Day line retained the integrity of the uptrend, and buyers taking back control near the Fibonacci level reflected strong demand.

Upside Breakout Anticipated

The pennant is a trend continuation pattern, so the expectation is for an eventual upside breakout. That would first be indicated on a rally above the top boundary line for the pattern, with higher conviction on a sustained rally above a lower swing high at $3,451. A daily close above that level will confirm that breakout.

However, given the relationship to resistance around the dashed downtrend line and the closeness to the small triangle apex, an upside breakout could be coming soon. When multiple indicators come together to identify a similar price level during at the time that a breakout could happen, there can be a more significant reaction in price.

Above $3,346 Points Higher

Nonetheless, a decisive bullish short-term reversal is not triggered until a minor swing high of $3,366 is exceeded. Earlier signs of strength will be on a rally above today’s high, followed by a breakout above a three-day range at $3,346. On the downside, a drop below $3,283 indicates a failure of the bull pattern.

For a look at all of today’s economic events, check out our economic calendar.

Copper price remains stable until this moment within the bullish track, taking advantage of the stability of the extra support at the $5.3200 level, attempting to gather the required extra positive momentum to resume the rise in the near period, reminding you that the initial main stations are stable near $5.7200 reaching the resistance of the bullish channel at $6.0400.

The decline below the support and providing a negative close, so that will force it to form bearish correctional trading, which forces it to suffer some losses by reaching $5.095 and $4.7600 to resume the bullish attack.

The expected trading range for today is between $5.3500 and $5.7200

Trend forecast: Bullish

Short-term Strength Faces Overhead Pressure

Although natural gas is rebounding today, its reaction to upcoming resistance will be more telling about the potential future. Possible resistance around the 200-Day MA, now at $3.43, is the first price area to consider. But it can be combined with Monday’s high of $3.47 and the 50-Day MA, now at $3.53, to establish a price zone.

The moving average is being referred to recognizing that it is generally less useful in a consolidation environment since it is a trending indicator. That is because the AVWAP line measured from the April swing low is pointing to the same price level currently. And the 20-Day MA is heading towards a convergence with those lines as well.

Key Resistance at $3.57

Nevertheless, it looks like an interim lower swing high of $3.57 is the next higher potential resistance of level with the most significance. This is because the downtrend price structure of the second leg down from the June swing high will be violated. Further, a rally above that high will follow an advance above the lower potential resistance levels mentioned above.

Distribution Risk Rises

There were enough bearish signals recently to consider the potential for a lower target zone to be reached following a bounce. Several indicators point to a possible lower target of significance around an AVWAP level at $2.96. That price area is near a long-term uptrend (purple) started from the April 2024 low. It has potential significance given its long-term position and the fact that it is the lower line of a rising trend channel. Since resistance around the top channel line was confirmed by the decline that followed the March trend high, the lower channel line becomes a potential target.

For a look at all of today’s economic events, check out our economic calendar.

The (silver) price rose in its last intraday trading, due to its lean on the critical support level at $36.30, providing more of the positive momentum that assisted it to settle, especially with the beginning of positive overlapping signals appearance on the (RSI), after reaching exaggerated oversold levels compared by the price move, indicating the beginning of forming positive divergence, which will intensifies the positive pressures, amid the dominance of the main bullish trend on the short-term basis and its trading alongside a bias line.

Reaction to Sharp Decline

One way to think about the current rally is in relationship to the sharp decline that followed the April lower swing high due to similar volatility. The total decline, from high to low, was $17.25, while the current advance when measured from the higher swing low (C) from May 1, was $17.03. Once there is similarity to a prior swing there is the potential for resistance, in this case. Moreover, notice how resistance was seen recently at a top rising parallel trend line. The line parallels the uptrend line that starts from the higher swing low in May and shows symmetry within a rising trend channel.

Resistance Persists

Today’s high provided a third daily test of the line and resistance was seen once again. Once symmetry in the rising channel is confirmed, there is the potential for a pullback or bearish reversal. A decline below Thursday’s low of $74.02 will trigger the bearish shooting star candle and a one-day bearish reversal off identified resistance.

Key support is the 200-Day MA, now at $69.02, while a minimum decline is anticipated to the 38.2% Fibonacci retracement at $70.65. Watch the 200-Day line along with a 50% retracement level at $68.64. Another area to watch for early support is around an AVWAP level at $72.24. It is potentially significant since it is anchored long-term, starting at the April 2024 swing high day.

For a look at all of today’s economic events, check out our economic calendar.

XAU/USD Current price: $3,314.85

• Rallying US equities undermine demand for the bright metal.
• Hawkish comments from Fed officials and risks of higher rates hit Gold.
• XAU/USD retreated from around $3,300 and gains downward traction.

Gold price advanced throughout the first half of the day, but retreated in the American session, towards the current $3,310 a troy ounce area. The XAU/USD advanced on broad US Dollar (USD) weakness, a consequence of the latest United States (US) President Donald Trump round of letters.

Trump announced another series of levies through Truth Social on Wednesday, including a fresh 50% tariff on all copper imports starting August 1, while threatened Brazil with a 50% tax, accusing the country of unfair trade practices and of conducting a “which hunt” against former President Jair Bolsonaro.

The mood, however, changed after Wall Street’s opening, with US indexes rallying and weighing on the safe-haven metal. The USD in the meantime, trades mixed across the FX board, firmer against high-yielding rivals, yet falling vs commodity-linked ones.

Meanwhile, hawkish Federal Reserve (Fed) headlines add to Gold weakness. Following the release of the Federal Open Market Committee (FOMC) meeting Minutes on Wednesday, showing policymakers are in no rush to cut rates, came comments from St. Louis Fed President Alberto Musalem. Musalem noted that the economy is in a good place, but highlighted the risks from tariffs. He noted he expect the effects of tariffs to show on upcoming June data, adding a clearer picture could be seen in the summer.

Finally, JP Morgan CEO, Jamie Dimon, said he would price in a 40%-50% chance of higher US interest rates, adding he believes markets are underestimating the risk of higher US rates.

XAU/USD short-term technical outlook

The daily chart shows that the XAU/USD pair struggles around its daily opening, while still trading between Fibonacci levels. The pair is currently below the 38.2% retracement of the June slide at around $3,325, failing on an early attempt to run beyond the level. The next Fibonacci support, comes at 3,295.50. Other than that, the pair keeps developing below a mildly bearish 20 Simple Moving Average (SMA), currently at around $3,350, while technical indicators remain lifeless just below their midlines.

The near-term picture hints at lower lows ahead. In the 4-hour chart, XAU/USD is piercing a directionless 20 SMA, while the upside remains contained by a bearish 100 SMA in the $3,330 region. Finally, technical indicators gain downward traction within negative levels, reflecting the ongoing slide rather than anticipating another leg lower.

Support levels: 3,295.50 3,287.40 3,274.50

Resistance levels: 3,325.00 3,350.00 3,373.40

European storage levels are also supportive for supply confidence, with stocks at 61% capacity compared to a five-year seasonal average of 70%.

How Do Production and Power Demand Factor Into the Outlook?

Lower-48 dry gas production remains strong at 105.3 Bcf/day (+3.6% y/y), while demand fell to 77.5 Bcf/day (-8.6% y/y), highlighting the near-term oversupply environment.

LNG net flows to U.S. export terminals stand at 15.0 Bcf/day (+0.9% w/w), maintaining steady export demand but insufficient to fully offset domestic oversupply.

Meanwhile, the Edison Electric Institute reported a +1% y/y increase in U.S. electricity output last week, reflecting a positive driver for baseline natural gas demand from utilities, although not enough to overshadow the cooler weather risk.

Market Forecast: Bearish Bias Holding

The near-term outlook remains bearish for natural gas, with the combination of cooler weather forecasts, strong production, and above-average storage builds outweighing steady export and power demand.

A move below $3.149 would reinforce downside momentum toward $2.885, while resistance near $3.574 and the $3.794–$3.800 zone will likely cap rallies unless weather models turn materially hotter.

Traders should remain cautious, with a bearish bias favored into the EIA data release and early next week’s trade.

More Information in our Economic Calendar.

The EURJPY pair didn’t settle above the bullish channel’s resistance at 171.85, due to its neediness to the positive momentum, which forces it to form a temporary rebound by targeting 171.20 level, then begin forming sideways trading attempting to gather the required positive momentum.

To recommend waiting for confirming breaching the current resistance, to reinforce the chances for forming a new bullish attack, to target the positive stations near 172.85 and 173.45, while the breach failure might force it to form a new correctional rebound, to suffer some losses by reaching 170.45 and 169.65.

The expected trading range for today is between 171.20 and 172.85

Trend forecast: Bullish

The EURJPY pair didn’t settle above the bullish channel’s resistance at 171.85, due to its neediness to the positive momentum, which forces it to form a temporary rebound by targeting 171.20 level, then begin forming sideways trading attempting to gather the required positive momentum.

To recommend waiting for confirming breaching the current resistance, to reinforce the chances for forming a new bullish attack, to target the positive stations near 172.85 and 173.45, while the breach failure might force it to form a new correctional rebound, to suffer some losses by reaching 170.45 and 169.65.

The expected trading range for today is between 171.20 and 172.85

Trend forecast: Bullish

Platinum price attempted to face the negative pressures by providing repeated positive closes above 2.00%Fibonacci extended level at $1330.00 level, forming extra support against the bearish correctional attempts.

The stability of the extra support, we will begin preferring the bullish attempts that targets $1375.00, then attempt to press on the barrier near $1420.00, while breaking the current support will force it to suffer extra losses that might extend to $1315.00 and $1301,00.

The expected trading range for today is between $1330.00 and $1375.00

Trend forecast: Bullish