Strong Bearish Momentum

Given the strong bearish momentum seen in today’s wide range red candle, it looks like natural gas may have a plan to test support again around the 20-Day MA, which is currently at 2.64. It is now lined up with a minor swing low, also at 2.64. Together, they indicate stronger potential support than if they were alone. A little lower is the 50-Day MA at 2.59, followed by a prior swing low at 2.51. Either price area may see signs of support.

Risk of Bearish Weekly Pattern

Nonetheless, since there is only one more trading day for the week, if downward pressure remains on Friday, there is a chance natural gas will complete the week with a bearish shooting star candlestick pattern. That would provide a potentially bearish weekly setup heading into next week. Once one side of a consolidation pattern is tested as either support or resistance, there is the potential to eventually test the other side of the pattern.

Natural gas found resistance this week around the top boundary line of a large symmetrical triangle pattern. A bullish breakout of the triangle would occur on a sustained rally above the prior sein high at 3.02. But since resistance was seen leading to today’s selloff, there is the potential to test support eventually near the bottom of the pattern. This doesn’t mean it will do so, but it does indicate selling pressure and that could provide a surprise to the downside.

Key Support Defined by 50-Day MA

Nevertheless, until there is a decisive decline below the 50-Day MA, the likelihood of finding support that leads to a bullish reversal at or above the 50-Day line is the dominant thesis. A drop sustained decline below the 50-Day line would possibly lead to a retest of support around the 200-Day MA, currently at 2.24.

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

XAU/USD Current price: $2,576.61

• Mixed United States data and Fed speakers helped US Dollar correct overbought conditions.
• Central bank’s leaders will be on the wires during the American afternoon.
• XAU/USD in a corrective advance that may continue in the near term.

Spot Gold trades around $2,575 a troy ounce, recovering from a fresh multi-week low of $2,536.68 posted during European trading hours. The US Dollar maintained its positive momentum until Wall Street’s opening, reaching once again fresh highs across the FX board.

United States (US) data came in mixed, as the country reported that Initial Jobless Claims shrank to 217K in the week ended November 8, better than the 223K anticipated. However, the October Producer Price Index (PPI) rose by more than expected, reviving inflation-related concerns. Wholesale inflation was up by 0.2% in the month and 2.4% from a year earlier. The core annual reading printed at 3.1%, above the 3% forecast and the previous 2.9%. The latter was upwardly revised from a previous estimate of 2.8%.

Meanwhile, different Federal Reserve (Fed) officials have been on the wires. So far, comments have added nothing new to what the market already knew about monetary policy. Later in the day, the focus will be on Chairman Jerome Powell, due to participate in a panel discussion titled “Global Perspectives” at an event hosted by the Federal Reserve Bank of Dallas. Comments on monetary policy may be limited, but questions about how the upcoming Donald Trump government will affect the central bank’s decision will be at the top of the list.

European Central Bank (ECB) President Christine Lagarde and Bank of England (BoE) Governor Andrew Bailey are also expected to share their thoughts.

XAU/USD short-term technical outlook

The daily chart for XAU/USD shows that it bounced from a bullish 100 Simple Moving Average (SMA) and that the pair develops far below a bearish 20 SMA. At the same time, technical indicators keep heading south near oversold readings, albeit losing their downward strength.

In the near term, and according to the 4-hour chart, the ongoing upward correction seems poised to continue. Technical indicators aim sharply north, albeit still below their midlines. At the same time, the 20 SMA heads firmly lower, currently providing dynamic resistance at around $2,594.20. Finally, the 100 SMA gains downward traction above the 200 SMA, approaching the longer one, usually hinting at a long-lasting bearish trend.

Support levels:  2,548.70 2,536.60 2,522.40

Resistance levels: 2,581.35 2,594.20 2,611.05

• Silver price gauges an interim cushion near $29.70, more downside looks likely.
• The US Dollar’s rally stalls after the release of the US jobless claims and the PPI data.
• A firm outlook on Trump’s policies will keep the Silver price edgy.

Silver price (XAG/USD) discovers a temporary support near $29.70 in Thursday’s North American session. The white metal finds cushion as the US Dollar (USD) gives up some intraday gains after posting a fresh annual high. The rally in the US Dollar index (DXY), which gauges Greenback’s value against six major currencies, pauses for a while after jumping to near 107.00.

The Greenback faces mild pressure after the release of the US Initial Jobless Claims for the week ending November 8 and the Producer Price Index (PPI) data for October even though the data was USD-positive. Individuals claiming jobless benefits for the first time came in surprisingly lower at 217K than the prior release of 221K, which was expected at 223K.

The headline producer inflation data accelerated to 2.4%, faster than estimates of 2.3% and the September reading of 1.9%. In the same period, the core PPI – which strips off volatile food and energy prices rose by 3.1% than estimates of 3% and the former release of 2.9%. Historically, signs of acceleration in price pressures weigh on market expectations for Federal Reserve (Fed) interest rate cuts, however, the impact is expected to negligible as officials are more worried about stabilizing job market.

For more interest rate cues, investors await Fed Chair Jerome Powell’s speech, which is scheduled at 20:00 GMT.

Meanwhile, the outlook of the Silver price is expected to remain vulnerable as policies of President-elected Donald Trump could limit the Fed’s potential of cutting interest rates aggressively.

Silver technical analysis

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

The near-term trend of the Silver price has weakened as the 20-day Exponential Moving Average (EMA) starts declining, which trades around $32.00.

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

Silver daily chart

• Silver price depreciates as risk-sensitive assets advance due to improving risk-on sentiment.
• The dollar-denominated Silver faces challenges as the US Dollar surges to its highest level since November 2023.
• Higher yields exert downward pressure on non-yielding assets like Silver.

Silver price (XAG/USD) extends its losses to two-month lows, trading around $29.90 per troy ounce during the European hours on Thursday. This downside of the safe-haven Silver is attributed to improving risk sentiment since Donald Trump’s election victory last week.

The US Dollar (USD), equities, and cryptocurrencies are advancing as markets anticipate strong growth and higher inflation under the incoming Trump administration. The proposed policies could drive increased investment, spending, and labor demand, raising inflation risks.

The dollar-denominated Silver faces challenges due to solid US Dollar (USD). The US Dollar Index (DXY), which measures the value of the US Dollar against its six major peers, holds steady around 106.60, its highest level since November 2023.

The US Dollar also gains support from rising US Treasury yields, with the 2-year and 10-year yields standing at 4.29% and 4.46%, respectively, at the time of writing. Additionally, these higher yields are exerting downward pressure on non-yielding assets like Silver.

The non-interest-bearing assets like Silver might have received downward pressure from less dovish remarks by Federal Reserve (Fed) officials on Wednesday. St. Louis Fed President Alberto Musalem remarked that ongoing inflationary pressures make it challenging for the Fed to maintain a course of rate cuts. Musalem shifted focus to the robustness of the US labor market, aiming to ease concerns about inflation’s resistance to the Fed’s efforts to reduce it.

Federal Reserve Bank of Kansas City President Jeffrey Schmid highlighted potential challenges in the journey toward lowering interest rates. Schmid also criticized market participants who continue to hold out hope for a return to near-zero rates, calling their expectations unrealistic.

Targets 50% Retracement at 2,534

Indications are that gold is heading towards a test of support around the 50% retracement at 2,534 and prior resistance at 2,532. The lower price was also the highest traded price for August. Also, 2,532 begins a price range down to approximately 2,484. Support might be seen anywhere within that range. Subsequently, the next lower target looks to be a range from 2,484 to 2,473. The first price level is a prior trend high from July, followed by the 61.8% Fibonacci retracement at 2,473.

Monthly Bearish Reversal Triggered

Following a break below the October low yesterday, natural gas confirmed the breakdown by ending the day below the monthly low. The monthly trend of higher monthly highs and higher lows has persisted for eight months until now. This is a bearish sign on the larger time frame indicating further selling pressure for the precious metal.

Downtrend Progresses

Notice that resistance today was seen at a high of 2,619, a clear test of resistance at the internal trendline. The line was previously representing support but since the drop below the line this week, it now represents potential resistance. And it acted as an area of resistance today as gold turned back down once it was hit. In a downtrend, once support is broken and then subsequently successfully tested as resistance, the decline is ready to proceed.

That is what we see today. Since the close for today will likely occur in the lower quarter of the day’s price range and below yesterday’s low of 2,590, sellers remain clearly in charge. So, the next lower target zone is looking more likely to be reached before this correction is over.

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

• Silver remains under some selling pressure on Thursday and retests October’s swing low. 
• The technical setup favors bearish traders and supports prospects for additional losses.
• Any attempted recovery could still be seen as a selling opportunity and remain capped.

Silver (XAG/USD) attracts some follow-through selling during the Asian session on Thursday and drops to its lowest level since September 19 in the last hour. Bearish traders now await a sustained break below the $30.00 psychological mark before positioning for an extension of the recent sharp retracement slide from a 12-year peak touched last month.

The overnight close below the 50% Fibonacci retracement level of the August-October rally and a subsequent break through the 100-day Simple Moving Average (SMA) for the first time since September could be seen as a fresh trigger for bearish traders. Moreover, oscillators on the daily chart have been gaining negative traction and are still away from being in the oversold zone. This, in turn, suggests that the path of least resistance for the XAG/USD remains to the downside and supports prospects for a further depreciating move. 

The white metal might then accelerate the fall towards the 61.8% Fibo. level, around the $29.65-$29.60 region. The downward trajectory could extend further towards the $29.20-$29.15 area before the XAG/USD eventually breaks below the $29.00 mark and tests a technically significant 200-day SMA, currently pegged near the $28.65 zone.

On the flip side, any meaningful recovery attempt might now confront a stiff barrier near the $30.60 region (50% Fibo. level). Some follow-through strength, however, could trigger a short-covering rally and allow the XAG/USD to reclaim the $31.00 mark, though the momentum is more likely to remain capped near the $31.20 support-turned-resistance. The latter should act as a key pivotal point, which if cleared decisively will suggest that the commodity has formed a near-term bottom and pave the way for additional gains.

Silver daily chart

• Gold sellers refuse to give up, awaiting Fed Chair Jerome Powell’s speech.   
• The US Dollar and Treasury yields keep rallying on Trump trades euphoria.
• Defending 100-day SMA near $2,545 is critical for Gold buyers as the daily RSI stays bearish.

Gold price is sitting at its lowest level in two months near $2,560 early Thursday, as buyers eagerly await US Federal Reserve (Fed) Jerome Powell’s speech for a brief respite.

Will Fed Chair Powell rescue Gold buyers?

Gold price extends its losing streak into a fifth consecutive day on Thursday, courtesy of the unabated US Dollar (USD) demand alongside the US Treasury bond yields rally.

The Trump trades-led europhoria continues to power USD buyers, notwithstanding the in-line with expectations US Consumer Price Index (CPI) data for October and a slew of speeches from Fed policymakers.

US CPI rose 2.6% annually in October, coming in higher than the 2.4% growth in September while meeting the forecast. The annual core CPI inflation steadied at 3.3% in the same period vs. 3.3% expected. Monthly figures also matched estimates.

Meanwhile, Fed officials remain wary of the inflation outlook, suggesting a cautious approach for the US central bank in the coming months.

However, the US inflation data and the Fed commentary advocated that the Fed should go for another 25 basis points (bps) interest rate cut in December. In fact, the market’s pricing for such a move next month now stands at about 83%, the CME Group’s FedWatch Tool shows, compared with around 63% seen prior to the data release.

Gold buyers fail to capitalize on dovish Fed expectations, as the Trump trades-inspired USD upsurge outweighs, exacerbating the pain in the bright metal.

Therefore, Fed Chair Jerome Powell’s speech on ‘Global Perspectives’ at an event hosted by the Federal Reserve Bank of Dallas later on Thursday remains in focus for fresh hints on the central bank’s easing trajectory in the face of the US President-elect Donald Trump’s potential inflationary policies.

Also, the focus remains on the US Producer Price Index (PPI) and Jobless Claims data, while more Fed officials are likely to take up the rostrum as attention likely returns to economic data.

Gold price technical analysis: Daily chart

As observed on the daily chart, Gold price gave up the $2,600 level on a daily closing basis on Wednesday, opening the door for more downside.

Adding credence to the bearish potential, the 14-day Relative Strength Index (RSI) points lower while well below the 50 level, approaching the oversold territory.

The immediate support is seen at the confluence of the 100-day Simple Moving Average (SMA) and the September 18 low near $2,545.

A sustained break below the last will initiate a fresh downtrend toward the $2,500 threshold, with the next bearish target seen at the September 4 low of $2,472.

If Gold price attempts a rebound,  the $2,600 mark will challenge the bearish commitments. Acceptance above that level will extend the recovery toward the November 13 low of $2,619.

Further up, the 50-day SMA at $2,651 will offer stiff resistance to Gold buyers.

Rally Above 3.02 Triggers Bull Breakout

Resistance was seen on Tuesday following the day’s high of 3.01. That was a failed attempt to break out above the most recent swing high of 3.02. A decisive rally above that high should provide a more reliable indicator for the triangle breakout. It will also signal a continuation of the rising trend that began from the August swing low as a higher swing high will be triggered.

The 3.02 high is also a monthly high for October. Therefore, a rise above it will also trigger a monthly upside breakout and result in a third month in a row of higher monthly highs and higher lows. Nonetheless, if natural gas can end the month above September’s closing price of 2.91 it will have reached its highest monthly closing price since October 2023.

Initial Upside Target at 3.22

Given the bullish recovery today following a pullback, it looks like natural gas may have completed a short correction and could attempt to advance above 3.02 shortly. If it can sustain a rally above that high, it next heads towards the 3.16 swing high from June. Then, a little higher, is an initial target from a small rising ABCD pattern (light blue) at 3.22. However, there is a confluence of price targets from 3.35 and 3.45, including the initial target from a rising ABCD pattern at 3.35 (purple) and a larger ABCD pattern marked in orange that targets 3.45.

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

• Silver struggles near 100-day SMA, with downside potential towards $30.00 and lower supports.
• Technical outlook suggests further weakness, with a key support at $30.18 and the 200-day SMA at $28.63 in focus.
• Recovery above $31.00 could challenge resistance at the 50-day SMA and extend towards $32.00.

Silver price drops below $30.50 for the second consecutive session, prints losses of over 0.90% following a tempered US inflation report. The US CPI came as expected, though he hinted that disinflation has stalled. The XAG/USD trades at $30.40, set to end the session lower.

XAG/USD Price Forecast: Technical outlook

Silver price consolidated during the last two days at around the 100-day Simple Moving Average (SMA) at $30.31. However, the mid-term bias is tilted to the downside, and once bears push prices below August’s 26 high turned support at $30.18, they will test the psychological $30.00 mark. A breach of the latter will expose the 200-day SMA at $28.63, followed by the September 6 swing low of $27.69.

If Silver moves back above $31.00, this could pave the way for challenging the 50-day SMA at $31.51. Once surpassed, XAG/USD’s next resistance would be $32.00.

Oscillators like the Relative Strength Index (RSI) hint that further XAG/USD’s downside is seen, as RSI remains shy of being oversold.

XAG/USD Price Chart – Daily

XAU/USD Current price: $2,586.03

• United States inflation met market expectations in October, still above the Fed’s goal.
• Stock markets remain under pressure, albeit Wall Street fights back on Wednesday.
• XAU/USD remains under pressure and aims to extend its slump in the near term.

After shedding some ground throughout the first half of the day, the US Dollar is back in fashion. The American currency trades with a firmer tone after Wall Street’s opening and the release of the United States (US) October Consumer Price Index (CPI), having reached fresh weekly highs against most major rivals. In the case of XAU/USD, the pair dipped below $2,600 but bounced back above it, currently struggling to extend its gains.

The US Bureau of Labor Statistics reported that the CPI rose at an annualized pace of 2.6% in October and was up by 0.2% on a monthly basis, matching expectations. The core annual figure printed at 3.3%, which was also in line with the forecast. The US Dollar ticked lower as an immediate reaction to the news but resumed its advance as US indexes quickly trimmed pre-opening gains.

At the time of writing, however, market participants are battling to establish a trend. The USD retains its strength, but the momentum eased, while US indexes pared the bleeding, with only the Nasdaq Composite trading in the red. The macroeconomic excitement will likely recede as the US has no other relevant figure to release for the rest of the week.

XAU/USD short-term technical outlook

XAU/USD trades at its lowest in two months in the $2,580 region and is technically poised to extend its slump. The daily chart shows the pair remains above 100 and 200  bullish moving averages, albeit the 20 Simple Moving Average (SMA) gains downward traction above the current level. Technical indicators, in the meantime, head firmly south within negative levels. The 100 SMA provides support at around $2,540.65.

In the near term, and according to the 4-hour chart, XAU/USD downward momentum remains strong. The intraday high was set below a firmly bearish 20 SMA, which extends its slope below the longer moving averages. Finally, technical indicators turned sharply lower after correcting oversold conditions, anticipating another leg south.

 Support levels: 2,572.45 2,560.65, 2,545.20

Resistance levels: 2,600.10 2,612.60, 2,627.10