Silver price bounced upwards after the decline that it witnessed in the previous sessions, as it approached the key support base 31.63$, noticing that Stochastic provides positive signals that support the chances of achieving more rise in the upcoming period.
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Gold price finds fresh demand early Friday as traders reposition ahead of US NFP data.
Fed rate cut expectations and waning trade war fears keep US Dollar on the back foot.
Impending Bull Cross on the 4H chart keeps Gold buyers hopeful.
Gold price is resuming its record-setting rally early Friday after taking a brief pause a day ago. However, Gold buyers stay cautious in the run-up to the critical US Nonfarm Payrolls (NFP) data release.
Will Gold price refresh record highs on weak NFP print?
All eyes now remain on the US labor market data, which will likely provide fresh insights on the scope and timing of the US Federal Reserve (Fed) interest rate cuts this year. The data is also likely to have a significant impact on the US Dollar (USD) and the US Treasury bond yields, eventually influencing the near-term direction in Gold price.
The US economy is seen creating 170,000 jobs in January after recording a stellar job gain of 256,000 in December. The Unemployment Rate is likely to remain at 4.1% in the same period. Meanwhile, Average Hourly Earnings are set to rise by 3.8% in January, compared to a 3.9% increase previously.
A smaller-than-expected increase in the headline NFP figure and slowing wage growth could indicate loosening labor market conditions in the US, reviving dovish Fed expectations and driving Gold price to fresh all-time highs close to the $2,900 threshold. In case of an upside surprise, markets will double down on the recent hawkish hold decision by the Fed, dialling down expectations of two Fed rate cuts this year.
The US Dollar will likely receive the much-needed respite from a potentially strong US payrolls data, initiating a corrective decline in Gold price.
The Greenback consolidates weekly losses heading into the main event risk for Friday – the US employment data, bearing the brunt of receding fears of a potential global trade war after US President Donald Trump’s pushback on Canada and Mexico for a month while markets look past the US-Sino tariff war, expecting no further escalation.
This has helped the USD-denominated Gold price hold near lifetime highs.
Gold price technical analysis: Four-hour chart
Gold price portrays an impending Bull Cross on the four-hour time frame. Gold buyers need a four-hour candlestick closing above the falling trendline resistance at $2,862 to validate the bullish continuation pattern.
If the further upside is confirmed, Gold price will retest the record highs at $2,882. The next relevant target is aligned at the $2,900 round level, above which the $2,95 psychological level will be tested.
The Relative Strength Index (RSI) points north while above the midline, currently near 63. The leading indicator remains supportive of the upside bias.
On the flip side, any retracement will meet the initial demand at $2,849, the 21-four-hour Simple Moving Average (SMA).
The falling trendline support at $2,826 will be the next cushion for Gold price, below which the $2,800 level will be challenged.
Economic Indicator
Nonfarm Payrolls
The Nonfarm Payrolls release presents the number of new jobs created in the US during the previous month in all non-agricultural businesses; it is released by the US Bureau of Labor Statistics (BLS). The monthly changes in payrolls can be extremely volatile. The number is also subject to strong reviews, which can also trigger volatility in the Forex board. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish, although previous months’ reviews and the Unemployment Rate are as relevant as the headline figure. The market’s reaction, therefore, depends on how the market assesses all the data contained in the BLS report as a whole.
The GBPJPY pair ended the last negative attack by touching the target at 187.70, facing solid support as appears on the chart to start forming correctional bullish waves by consolidating near 188.50 now.
Note that the continuous consolidation above the mentioned support will confirm forming new bullish waves to expect rallying towards 189.50, while surpassing it will extend trades towards 190.90, while facing negative pressures and crawling below the current support will confirm moving to new negative track to suffer big losses by moving towards 185.90 first.
The expected trading range for today is between 187.70 and 189.50
Bitcoin price (BTCUSD) shows bearish bias to head towards potential test to the key support 95195.00$, which represents one of the next trend keys besides 100000.00$ resistance, and as we mentioned yesterday, the price needs to breach one of these levels to detect its next destination clearly, which makes us continue with our neutrality until now.
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It is interesting to note that a falling measured move completes at $68.52. The first measured decline began from the October swing high. Following that high the price of crude oil dropped by $12.24 or 15.5%. There will be a match in the two declines based on the price change if the $65.52 price target is reached.
Since that potential target is close to the $67.72 target, as well as the lower uptrend line, and bearish momentum is continuing, it seems like a good chance the lower price levels may eventually be reached before the current correction is complete. Moreover, crude oil could continue to fall further until it triggers a bearish breakdown on a drop below the uptrend line initially, with weakness confirmed on a drop below the $67.11 minor swing low from December 6.
78.6% Retracement Could See Support
Despite the potential bearish scenario, if support is seen around the 78.6% retracement area, a bounce could follow. In that situation, potential resistance would be around the 50-Day MA, now at $72.61. That price level is followed by $73.27, which was both support and resistance previously. Further up is the 200-Day MA at $74.83 and the 20-Day MA at $75.69. Keep in mind that the moving averages are dynamic and that the price represented will change.
Overhead Resistance May Stunt Rallies
Be aware that 200-Day MA is angled down and that the 20-Day only recently turned down after rising for approximately 35 trading days. Further, both moving averages are a little below a bottom boundary line for a large symmetrical triangle pattern. Together, these indicators show potentially significant resistance around the 20-Day MA, since it is above the 200-Day line currently.
For a look at all of today’s economic events, check out our economic calendar.
The first upside target is shown on the chart at $3.51 to $3.52. It starts with the 38.2% Fibonacci retracement and is followed by the 50-Day MA. Note that the price represented by the 50-Day line may change slightly before it is reached. Also, be aware of the internal downtrend line near to today’s price action.
Although it may not provide a clear price to gauge from, it can help as a guide. The next more significant potential resistance zone above the 50-Day line is around the 20-Day MA, currently at $3.67. Notice that the 20-Day line has been falling recently and has entered the price range discussed previously from the $3.64 peak in 2023, and the 50% retracement at $3.67.
Rising ABCD Pattern Points to $3.58
An interim upside target has been added to the chart since as of today there is a higher swing high for the developing ABCD pattern (light blue) starting from the recent $2.99 low (A). The initial target from the patten is $3.58, approximately halfway between the 50-Day and 20-Day MAs. Further up is the 127.2% extended target from the pattern at $3.69. Therefore, that higher price target can be added to the price range around the 20-Day MA.
Wide Range Week Consolidation
Since this week’s price action is contained with a wide range from last week, it would not be surprising to see natural gas continue to slowly advance and fill more of that range. Last week’s range goes from a low of $2.99 to a high of $3.83. Last week’s high marks the next higher potential target area above the $3.69 price level.
For a look at all of today’s economic events, check out our economic calendar.
Silver retreats from a three-month high, though the downside seems limited.
The technical setup supports prospects for the emergence of some dip-buying.
A convincing break below the $31.00 mark would negate the positive outlook.
Silver (XAG/USD) attracts some sellers following an intraday uptick on Thursday and snaps a three-day winning streak to a three-month top, around the $32.55 region touched the previous day. The white metal sticks to its intraday losses and currently trades near the lower end of its daily range, around the $32.00 mark, down 0.75% for the day.
From a technical perspective, the recent breakout through the $31.00 confluence – comprising the 38.2% Fibonacci retracement level of the October-December fall and the 100-day Simple Moving Average (SMA) – was seen as a key trigger for bulls. A subsequent strength beyond the 50% retracement level, around the $31.70-$31.75 region, and positive oscillators on the daily chart validate the constructive setup.
Hence, any further slide below the $31.75-$31.70 area, or the daily swing low, could be seen as a buying opportunity. This, in turn, should help limit the downside for the XAG/USD near the $31.00 resistance breakpoint, now turned support. A convincing break below the latter, however, could make the XAG/USD vulnerable to accelerate the fall toward the $30.25 support zone en route to the $30.00 psychological mark.
On the flip side, the $32.55 area, or a multi-month peak touched on Wednesday, now seems to act as an immediate hurdle. Some follow-through buying should allow the XAG/USD to climb further towards reclaiming the $33.00 mark for the first time since early November. The said handle also represents the 61.8% Fibo. level, which if cleared decisively will set the stage for an extension of over a one-month-old uptrend.
Silver daily chart
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold’s. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold’s moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
The Bank of England’s dovish cut helped the US Dollar to retain its recent strength.
The market mood improved, yet investors are far from optimistic.
XAU/USD is in a corrective decline that could continue in the near term.
The US Dollar (USD) found some near-term demand on Thursday, resulting in XAU/USD retreating from record highs. The pair trades around $2,850 in the American session after hitting $2,882.35 on Wednesday. An improved market mood adds pressure on the safe-haven metal, albeit speculative interest is far from optimistic.
Trade-war tensions have been put temporarily aside but remain firm in the background as attention has shifted to first-tier events. On the one hand, the United States (US) kept publishing employment-related data ahead of the January Nonfarm Payrolls report scheduled for Friday. The country is expected to have added 170K new jobs in the month, while the Unemployment Rate is expected to hold steady at 4.1%. Employment-related data released ahead of the announcement has been tepid yet far from worrisome.
Additionally, the Bank of England (BoE) announced its monetary policy decision. The Monetary Policy Committee (MPC) trimmed the benchmark interest rates by 25 basis points (bps) to 4.50% as expected, although the dovish surprise came from policymakers, as all nine MPC members voted for a cut, with two of them favoring a 50 bps trim. Additionally, officials upwardly review their near-term inflation perspective while downgrading growth expectations for this year. The dovish tone of the BoE helped the USD maintain its near-term strength.
Looking ahead, however, demand for the bright metal is set to prevail amid continued uncertainty regarding the US tariffs’ plan.
XAU/USD short-term technical outlook
From a technical point of view, the daily chart for XAU/USD shows that the ongoing slide could be seen as corrective. A lower low and a lower high, however, suggest a bearish extension is likely. The same chart shows that technical indicators are retreating from their recent peaks in overbought territory but with limited downward strength and still at extreme levels. At the same time, the bright metal develops above all bullish moving averages, with the 20 Simple Moving Average (SMA) currently at around $2,755.35.
The 4-hour chart anticipates another leg lower, particularly if XAU/USD slides below the intraday low at $2,833.96, although still suggesting declines would remain corrective. The pair is battling to remain above a bullish 20 SMA while the 100 and 200 SMAs head north far below the shorter one. Technical indicators, in the meantime, have corrected extreme overbought conditions and are currently approaching their midlines with firmly bearish slopes.
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Silver prices surged to a three-month high of $32.38 on Wednesday.
Safe-haven metals gain ground amid risk-off mood following global trade and economic uncertainties.
Dollar-denominated Silver gains traction as the USD experiences a technical pullback.
Silver price (XAG/USD) rises for the third successive session, trading around $32.30 per troy ounce, during the European hours on Wednesday. The safe-haven metals like Silver gain ground due to increased risk aversion following global trade and economic uncertainties.
In response to the new 10% US tariff that took effect on Tuesday, China imposed a 15% tariff on US coal and liquefied natural gas (LNG) imports, along with an additional 10% tariff on crude oil, farm equipment, and certain automobiles.
However, traders remain hopeful for a potential resolution between the United States (US) and China, similar to the agreements reached with Mexico and Canada. US President Donald Trump stated on Monday that he expects to speak with China soon but warned, “If we can’t reach a deal with China, the tariffs will be very, very substantial.” However, no further developments have been reported.
Trump, earlier this week, announced a temporary suspension of tariffs on Mexico and Canada after their leaders agreed to deploy 10,000 troops to the US border to combat drug trafficking. The tariffs initially imposed two days earlier—25% on Mexican and Canadian goods have been postponed for at least 30 days.
The dollar-denominated Silver attracts buyers as the US Dollar (USD) goes through a technical downward correction. The US Dollar Index (DXY), which measures the US Dollar’s value against six major currencies, remains under downward pressure for the third successive day, trading around 107.70 at the time of writing. Meanwhile, traders brace for Friday’s US Nonfarm Payrolls (NFP) data, which is expected to shape the Federal Reserve’s (Fed) monetary policy direction.
Silver, which does not yield interest, is benefiting from the dovish stance of major central banks. The Bank of Canada (BoC) has halted its quantitative tightening and joined Sweden’s Riksbank in cutting interest rates. Last week, the European Central Bank (ECB) lowered its Deposit Facility Rate by 25 basis points (bps) to 2.75%, while both the Reserve Bank of India (RBI) and the People’s Bank of China (PBoC) have signaled potential rate cuts ahead. Additionally, markets expect the US Federal Reserve (Fed) to implement two rate cuts this year.
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold’s. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold’s moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
