XAU/USD Current price: $2,615.59

• Chinese inflation-related data undermined the market mood at the beginning of the week.
• The United States (US) will release the October Consumer Price Index next Wednesday.
• XAU/USD could keep falling sub-$2,600 despite near-term oversold conditions.

Spot Gold fell throughout the Asian and European sessions as demand for the US Dollar continues following last week’s United States (US) events. Former President Donald Trump’s victory in the 2024 election and signs that Republicans will take full control of Congress fueled the USD amid hopes the upcoming government will strengthen the local currency. Even further, the Federal Reserve (Fed) announced a modest 25 basis points (bps) interest rate cut, sticking to its path without showing concerns about the economy’s performance.

Beyond US developments, market players are paying close attention to what’s happening in China. Inflation, as measured by the Consumer Price Index (CPI) resulted negative in October, posting a -0.3% MoM. Furthermore, the annualized Producer Price Index (PPI) declined 2.9% in October, fueling deflation-related concerns.

Data-wise, the macroeconomic calendar had nothing relevant to offer, with investors awaiting the US October CPI, scheduled for release next Wednesday. US inflation, at this point, may be irrelevant, considering investors are looking at whatever the new government will bring to the world’s largest economy.

XAU/USD short-term technical outlook  

From a technical point of view, XAU/USD is poised to extend its slump. The bright metal trades near the $2,600 mark and at fresh one-month lows. In the mentioned time frame, Gold develops well below a now flat 20 Simple Moving Average (SMA), while the 100 and 200 SMAs head firmly north far below the current level. Additionally, technical indicators head south almost vertically, well below their midlines, reflecting the strong selling interest.

The near-term technical picture suggests XAU/USD will extend its slide. In the 4-hour chart, a bearish 20 SMA accelerated south after crossing below a flat 200 SMA while providing intraday resistance around the daily high. At the same time, the Momentum indicator heads south almost vertically, while the Relative Strength Index (RSI) indicator maintains its downward slope at around 23 without signs of downward exhaustion.

Support levels: 2,601.90 2,588.70 2,572.45

Resistance levels: 2,627.10 2,639.05 2,651.00

• Silver price slumps below $31.00, weighed down by US Dollar’s rally.
• Trump’s victory has improved the US Dollar’s long-term outlook.
• Silver price sees more downside towards $29.00.

Silver price (XAG/USD) slides below the key support of $31.00 in Monday’s North American session. The white metal weakens as the US Dollar (USD) rallies on optimism over Republican Donald Trump’s victory in the United States (US) presidential elections.

Trump vowed to raise import tariffs by 10% universally and lower corporate taxes in his election campaign, a scenario that would boost fiscal deficit and inflationary pressures. This would force the Federal Reserve (Fed) to turn hawkish on interest rates. The impact will be favorable for the US Dollar (USD) and bond yields. Usually, higher yields on interest-bearing assets increase the opportunity cost of holding an investment in non-yielding assets, such as Silver.

At the time of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, surges above 105.60. 10-year US Treasury yields soar to 4.37%. This week, investors will be focused on speeches from a slew of Fed officials for fresh interest rate guidance. According to the CME FedWatch tool, the Fed is expected to cut interest rates by 25 basis points (bps) again to 4.25%-4.50% in the December meeting.

Meanwhile, an absence of China’s stimulus package allocation has also weighed on the Silver. Silver, as a metal, has applications in various industries such as power, Electric Vehicles, and mining, etc, and a smaller-than-expected stimulus boost has weakened Silver’s appeal.

On Friday, the National People’s Congress (NPC) unveiled a 10 trillion yuan debt package to stabilize economic growth.

“It may be disappointing for those who were expecting the NPC meeting to approve a massive fiscal package, but the expectation is unrealistic because the policy goal is to achieve the GDP growth target and reduce tail risks, not to reflate the economy in any meaningful way,” analysts at Macquarie said.

Silver technical analysis

Silver price declines toward the upward-sloping trendline around $29.00, plotted from the February 28 low of $22.30. The white metal weakened after breaking below the horizontal support plotted from May 21 high of $32.50.

The near-term trend of the Silver price has weakened as it establishes below the 50-day Exponential Moving Average (EMA), which trades around $31.60.

The 14-day Relative Strength Index (RSI) slides to near 40.00. A bearish momentum will trigger if the RSI (14) drops below the same.

Silver daily chart

• Gold sellers extend control below $2,700 early Monday as the US holiday could exaggerate price moves.
• The US Dollar rally pauses despite firmer Treasury bond yields and China woes-driven tepid risk sentiment.   
• Gold price looks to challenge critical $2,641 support as daily RSI pierces the midline from above.

Gold price has opened a new week on the back foot below $2,700, looking to extend its three-week losing streak. Rebounding US Treasury bond yields and China’s economic concerns offset a pause in the US Dollar( USD) upsurge, exerting additional downside pressure on Gold price.

Gold price kicks off the US inflation week on the back foot  

US Treasury bond yields stage a comeback in Asian trading on Monday after a dovish US Federal Reserve (Fed) interest-rate cut decision-led retracement late last week.

Meanwhile, the market’s disappointment with China’s 10 trillion yuan ($1.4 trillion) debt package and softening inflation raised concerns over the dragon nation’s economic prospects, rendering negative for Gold price. China is the world’s biggest Gold consumer.

China’s CPI rose 0.3% last month from a year earlier, slowing from September’s 0.4% rise and the lowest since June, data from the National Bureau of Statistics (NBS) showed on Saturday, missing a 0.4% increase estimated.

Further, investors remain wary of the more profound economic consequences of potential tariffs that US President-elect Donald Trump will impose once he returns to office in January of next year. This nervousness remains a drag on the bright metal even as USD buyers take a breather following the previous week’s relentless rise.

Gold traders also resort to position adjustments heading into the all-important US Consumer Price Index (CPI) inflation data due for release on Wednesday. However, a Veterans Day holiday in the US could exaggerate the Gold price action in the upcoming sessions.

Looking ahead, the broader market sentiment will play a pivotal role in influencing the value of the USD and the Gold price amid holiday-thinned trading conditions.

Gold price technical analysis: Daily chart

As observed on the daily chart, Gold price breached support at $2,673, the 61.8% Fibonacci Retracement (Fibo) level of the latest record rally from the October 10 low of $2,604 to the new all-time high of $2,790, as it witnessed a fresh leg down.

If the downside momentum gathers traction, sellers will attack $2,641 strong support again, which is the confluence of the 50-day Simple Moving Average (SMA) and the 78.6% Fibo level of the same advance.

The 14-day Relative Strength Index (RSI) points lower below the 50 level, having pierced that level from above on Friday. The leading indicator, therefore, suggests that more pain remains in the offing for Gold price.

On finding a solid foothold below the abovementioned critical support at $2,641, Gold sellers could flex their muscles toward the October 10 low of $2,604.

Conversely, Gold buyers need acceptance above the $2,700 barrier to test the healthy resistance at $2,718, where the 38.2% Fibo level and 21-day SMA converge.

A fresh uptrend would be initiated above that level as buyers aim for the previous static resistance near $2,745, where the 23.6% Fibo aligns.

• Gold price loses ground to around $2,680 in Monday’s early Asian session. 
• The strength of the USD undermines the yellow metal. 
• The uncertainty surrounding global economic uncertainty, geopolitical risks might boost safe-haven flows, benefiting the Gold price. 

Gold price (XAU/USD) trades in negative territory near $2,680 during the early Asian session on Monday. The downtick of the precious metal is pressured by a stronger US Dollar (USD) due to Donald Trump’s victory. 

Meanwhile, the US Dollar Index (DXY), an index of the value of the USD measured against a basket of six world currencies, extends its upside to around 105.00, the four-month high. 
 
Trump’s victory has fuelled questions about whether the US Federal Reserve (Fed) may proceed to cut rates at a slower and smaller pace. This, in turn, boosts the Greenback and weighs on the USD-denominated Gold price. 

“This rally in the dollar and yields has put pressure on gold, which traditionally falls as real interest rates rise, reflecting reduced demand for safe-haven assets in the short term,” noted Matthew Jones, precious metals analyst at London-based metals trader Solomon Global. “However, from a longer-term, macro perspective, the future is ‘as good as gold,” added Jones. 

The upbeat US economic data on Friday contributes to the USD’s upside. The US Consumer Sentiment Index rose to 73.0 in November from 70.5 in October, according to the preliminary reading by the University of Michigan. This figure came in better than the market expectation of 71.0.

On the other hand, the global economic uncertainty and the ongoing geopolitical tensions in the Middle East might help limit the yellow metal’s losses. Israeli army Chief of Staff Herzi Halevi approved the expansion of the ground invasion of southern Lebanon, state broadcaster Kan reports.  

• Silver trades below 50-day SMA at $31.37; $30.84 support is key for preventing deeper pullback.
• Bearish momentum persists with RSI in seller’s territory, favoring near-term downside.
• A close above $31.50 needed for bullish recovery, targeting $31.75 and potentially $32.00.

Silver retreated from two-day highs of $32.00 and tumbled below the 50-day Simple Moving Average (SMA) at $31.37 late in the North American session. This was weighed down by a strong US Dollar underpinned by former President Donald Trump’s victory. At the time of writing, the XAG/USD trades at $31.29, down 2.29%.

XAG/USD Price Forecast: Technical outlook

Silver’s price uptrend remains in play despite posting solid losses. The fall of US Treasury yields kept the grey metal from falling further, but a decisive break below the November 6 low of $30.84 could exacerbate a deeper pullback. In that outcome, the next support would be the 100-day SMA at $30.27, followed by the September 5 high turned support at $29.17.

For a bullish resumption, the XAG/USD must close above the $31.50 area. This could pave the way to challenge the July 11 high at $31.75. A breach of the latter will expose $32.00, followed by May’s 20 peak at $32.51.

Momentum is bearish in the near term, as shown by the Relative Strength Index (RSI), breaching its neutral line into the seller’s area.

XAG/USD Price Chart – Daily

Support from 2.50 to 2.55

Near-term potential support is around 2.58 to 2.55, consisting of a prior interim high and the 20-Day MA, respectively. Also, a weekly low is at 2.51 along with the 50-Day MA at 2.53. So, in summary there is a potential support zone from 2.58 to 2.51, while a drop below this week’s low could lead to an even deeper pullback.

Formed an Inside Week

This week will end with an inside week for natural gas. Therefore, a potential weekly bullish breakout will be set up for next week. A rise above the week’s high of 2.82 will signal the breakout, while a drop through the low of 2.51 may lead to a deeper retracement.

Given the price structure for natural gas, the expectation is for an eventual upside breakout. One reason is that last week triggered a bullish weekly reversal from a retracement low. But this doesn’t mean the lower price won’t be tested before a bullish breakout. Nonetheless, the market will signal based on its reaction to price levels.

Signs of Strength Begin Above 2.75

Earlier signs of strength will first be indicated on a rise above today’s high of 2.75, and then each daily high for this week starting with Tuesday. Notice that there are four days in a row where the high price for the day was lower than the prior day. Nevertheless, a breakout above the weekly high, or swing high of the daily chart, will provide a more convincing bullish signal, that may subsequently lead to an upside breakout from a large symmetrical triangle pattern.

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

• Silver price retreats from $32.30 as investors expect Trump’s protectionist policies could force the Fed to turn hawkish on interest rates.
• Fed Powell doesn’t see any near-term impact of Trump’s policies on the interest rate path.
• China’s economic package failed to impress market participants.

Silver price (XAG/USD) resumes its downside move after its recovery move met resistance near $32.20 in the North American session on Friday. The white metal falls back as traders assess the implications of Donald Trump’s victory in the United States (US) presidential elections on domestic and the global economy.

Donald Trump promised to raise tariffs by 10% universally, expecting China that could face duties rising as much as 60%. Higher tariffs on offering coming from the external economy would boost in house production and prompt labor demand, which will prompt inflationary pressures. This will force the Federal Reserve (Fed) to opt for a hawkish interest rate stance.

However, Fed Chair Jerome Powell doesn’t see any immediate impact of Trump’s victory on the monetary policy action in the upcoming meetings after the bank cut interest rates by 25 basis points (bps) to 4.50%-4.75% on Thursday.

Meanwhile, some recovery in the US Dollar after Thursday’s correction has also weighed on the Silver price. The US Dollar Index (DXY), which gauges Greenback’s value against six major currencies, jumps to nearly 106.40.

Apart from expectations for the Fed turning hawkish, an absence of meaningful economic stimulus by China has also weighed on the Silver price. In Friday’s late Asian session, China announced a massive 10 trillion yuan program to refinance local government debt with approval by the National People’s Congress. Market experts see the stimulus package as a measure against Trump’s potential tariffs, however, they consider it as insufficient to fix the likely impact on their economic growth.

Economists at Standard Chartered Plc expect “China’s growth would suffer a hit of as much as two percentage points should Trump follow through on his campaign vow to raise tariffs on Chinese goods to 60%.”

Silver as a metal has applications in various industries such as solar energy, mining, and power and signs of weak China growth prospects impact the Silver price.

Silver technical analysis

Silver price slides to near $31.00 after breaking below the horizontal support plotted from the May 21 high of $32.50. The near-term trend of the Silver price has turned bearish as it has dropped below the 50-day Exponential Moving Average (EMA), which trades around $31.60.

The asset could find support near the upward-sloping trendline around $29.00, plotted from the February 28 low of $22.30.

The 14-day Relative Strength Index (RSI) dives to near 40.00. Should RSI (14) falls below 40.00, a bearish momentum will be triggered.

Silver daily chart

• Silver struggles to capitalize on the previous day’s goodish rebound from a three-week low.
• The technical setup favors bears and supports prospects for a further near-term downfall.
• A sustained strength above the $32.30-$32.35 area is needed to negate the negative bias.

Silver (XAG/USD) meets with a fresh supply on Friday and reverses a major part of the previous day’s goodish recovery move from over a three-week low. The white metal continues losing ground through the first half of the European session and touches a fresh daily low, around the $31.30 area in the last hour.

From a technical perspective, any further decline is likely to find some support near the $31.00 mark ahead of the $30.85-$30.80 region, or the multi-week low. Some follow-through selling below the 50% Fibonacci retracement level of the August-October rally, around the $30.65-$30.60 area, will be seen as a fresh trigger for bearish traders. 

Given that oscillators on the daily chart have just started gaining negative traction, the subsequent fall could drag the XAG/USD below the 100-day Simple Moving Average (SMA), currently pegged around the $30.25 area, towards the $30.00 psychological mark. The downward trajectory could extend to the 61.8% Fibo. level, near the $29.65 region.

On the flip side, the $32.00 round figure now seems to have emerged as an immediate strong hurdle. This is followed by a hurdle near the $32.30-$32.35 horizontal zone, which if cleared decisively might trigger a short-covering move to the $33.00 mark before the XAG/USD extends the positive momentum towards the next relevant barrier near the mid-$33.00s.

Silver daily chart

Created on November 08, 2024

• The West Texas Intermediate crude oil market has bounced around during the trading session on Thursday as we wait for the FOMC meeting but there are a lot of technical things going on at the same time.
• The market is currently hanging around the 50 day EMA which is a large indicator that a lot of people pay close attention to.
• The $72.50 level above is a significant resistance barrier.

If we can break above that, then I think it opens up the possibility of a move toward the 200-day EMA, which is attractive to a lot of traders. And that happens to be near the crucial $75 region. If we pull back from here, the $70 level could be a major support level as we’ve seen a couple of times here recently, but even if we break down below that, then you’re looking at $67.50 level as a potential floor as well.

In general, this is a market that I think continues to see a lot of choppiness and indecision, and there are a lot of things going on to cause that. After all, we have seen the $65 level underneath is a massive floor in the market over the last couple of years.

The USA is About to Make Its Prescence Known

Regardless, this is a situation where the United States will be a major influence on the oil market going forward now that Donald Trump has been elected. One of his biggest platforms is to continue to drill and make not only the United States, energy independent, but energy dominant. For example, there are places in United States territory such as the Anwar, which is a preserve in Alaska, but if they tap that, it has more oil than Saudi Arabia. There is a high probability that the Americans will start drilling in places like that again, and if they do, it will put a bit of a ceiling on the market. That being said, that is several months out, maybe even a couple of years, but that will be an overhang in the market. So, I think we go sideways, possibly as high as the 200 day EMA, but breaking above there, I think is going to take some type of event. We’ll have to wait and see.

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• Silver price loses ground as higher US Treasury yields increase the opportunity cost of holding precious metals.
• The demand for dollar-denominated Silver struggles due to the improved US Dollar.
• Non-interest-bearing Silver received support on Thursday after the Fed announced a 25 basis point rate cut.

Silver price (XAG/USD) loses ground to near $31.70 per troy ounce during the Asian hours on Friday. A modest rise in US Treasury yields is adding downward pressure on non-yielding assets like Silver, as higher yields increase the opportunity cost of holding precious metals. At the time of writing, the 2-year and 10-year US Treasury bond yields stand at 4.20% and 4.33%, respectively.

Additionally, the demand for dollar-denominated Silver struggles, as a stronger US Dollar (USD) makes the precious metal more expensive for buyers using foreign currencies. The US Dollar Index (DXY), which measures the value of the US Dollar against the other six major currencies, advances to near 104.50 at the time of writing.

Traders expect potential stimulus measures from China as the National People’s Congress Standing Committee concluded its five-day meeting. Earlier this week, media reports suggested that the potential stimulus package could exceed 10 trillion yuan. As one of the world’s largest manufacturing hubs for electronics, solar panels, and automotive components, China may have increased demand for Silver.

However, prices of the non-interest-bearing Silver gained ground following the Federal Reserve’s recent rate cut. The Federal Open Market Committee (FOMC) lowered its benchmark overnight borrowing rate by 25 basis points (bps) to a target range of 4.50%-4.75% at its November meeting on Thursday.

Moreover, Federal Reserve Chair Jerome Powell indicated that the central bank is proceeding with interest rate cuts, given the ongoing tightness of monetary policy. Investors are now anticipating the release of the preliminary US Michigan Consumer Sentiment, which is expected later on Friday.