• Silver price recovers strongly from $30.50 after US ADP Employment Change data misses estimates by a slight margin.
• Investors await Fed Powell’s speech for fresh guidance about the likely interest rate path.
• Traders expect the Fed to cut interest rates by 25 bps to 4.25%-4.50% on December 18.

Silver price (XAG/USD) recovers in a V-shape manner from the key support of $30.50 in Wednesday’s North American session and refreshes an intraday high near $31.20 after the release of the United States (US) ADP Employment Change data for November. The agency reported that the private sector hired fresh 146K workers, marginally missed estimates of 150K but was significantly lower from the former release of 184K, downwardly revised from 233K.

However, the private sector employment data has not weighed much on the US Dollar (USD). The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, surrenders nominal gains but holds the key support of 106.50. 10-year US Treasury yields hold onto gains near 4.27%.

Historically, higher yields on interest-bearing assets increase the opportunity cost of holding an investment in non-yielding assets, such as Silver. But it doesn’t appear in this case, suggesting that geopolitical tensions continue to maintain safe-haven demand.

According to Reuters, the Hamas internal statement has reported that the group has information that Israel intends to carry out a hostage rescue operation similar to Israel’s June nuseirat operation in Gaza, a move that could derail the ceasefire between Iran and Israel. The appeal of the Silver price strengthens in a heightened geopolitical environment.

Going forward, investors will focus on Federal Reserve (Fed) Chair Jerome Powell’s speech at the New York Times DealBook Summit for fresh guidance on interest rates. The probability for the Fed to cut interest rates by 25 basis points (bps) to 4.25%-4.50% is 74%, while the rest favors leaving them unchanged at their current levels, according to the CME FedWatch tool.

Silver technical analysis

Silver price strives to extend recovery above the 20-day Exponential Moving Average (EMA), which trades around $31.30.

The 14-day Relative Strength Index (RSI) oscillates in the 40.00-60.00 range, suggesting a sideways trend.

Looking down, the upward-sloping trendline around $29.50, which is plotted from the February 29 low of $22.30 on a daily timeframe, would act as key support for the Silver price. On the upside, the horizontal support plotted from the May 21 high of $32.50 would be the resistance zone.

Silver daily chart

XAU/USD Current price: $2,655.15

• Central banks’ leaders and US macroeconomic data set the market’s tone.
• The US Dollar seesaws between gains and losses ahead of Fed Powell’s words.
• XAU/USD extends its consolidative phase with no directional strength in sight.

Back and forth among financial markets did not impact Gold price on Wednesday, with the bright metal stuck around $2,650 a troy ounce. The US Dollar seesawed between gains and losses, on the one hand, backed by political jitters weighing on the mood, and on the other hand, losing ground on the back of tepid United States (US) data.

Also, central banks’ chiefs affected markets. Bank of England (BoE) Governor Andrew Bailey was the first to publicly appear, saying markets should expect the United Kingdom (UK) to keep cutting rates gradually next year as inflation eases. He added that the disinflation process is well embedded but that there’s more to do.

Next was European Central Bank (ECB) President Christine Lagarde, who testified before the European Parliament’s Committee on Economic and Monetary Affairs. Lagarde said that the economic growth in the EU will be weaker in the near term, adding the recovery should start to gather “some steam.” She added inflation is expected to temporarily increase in the last quarter of the year, and decline to target in the course of the next one.

Data-wise, the US released the ADP Employment Change report, showing the private sector added 146,000 new positions in November, below the 150,000 expected. Additionally, the ISM Services Purchasing Managers Index (PMI), which unexpectedly fell to 52.1 in November from 56 in the previous month, also missed the expected 55.5.

Still pending is a speech from Federal Reserve’s (Fed) Chairman Jerome Powell, due to participate in a moderated discussion at the New York Times DealBook Summit. The next first tier-event will take place on Friday, when the US will release the November Nonfarm Payrolls (NFP) report.

 XAU/USD short-term technical outlook

From a technical point of view, XAU/USD has made no progress. The daily chart shows it has held within familiar levels for a seventh consecutive trading day, albeit finding intraday support around a now flat 20 Simple Moving Average (SMA). The 100 and 200 SMAs advance below the current level but lose their upward strength. Finally, technical indicators remain within positive levels, with uneven upward strength, not enough to confirm a bullish extension.

In the near term, and according to the 4-hour chart, XAU/USD is neutral. All moving averages are flat, with the 200 SMA at around $2,678.35 and the shorter ones below the current level. Technical indicators stand above their midlines but lack directional strength. Gold may keep consolidating ahead of upcoming central banks’ meetings scheduled throughout the upcoming two weeks.

Support levels: 2,626.70 2,611.35 2,598.70  

Resistance levels: 2,671.55 2,688.65 2,700.00

Created on December 03, 2024

•  This makes a huge difference, due to the fact that the futures markets of course have the most liquidity during the US session.
• Furthermore, it’s worth noting that the contract that you are trading in is more likely than not a derivative of the Henry Hub Natural Gas contract, which reflects the price of natural gas delivered from Henry, Louisiana.

There is a cyclical trade to be had here, as it is typical for the winter months to bring in more demand for natural gas for heating. Most of the northeastern part of the United States uses natural gas for heating, or at least some type of other gas such as propane, so these markets do tend to move somewhat in tandem. Ultimately, I think you’ve got a situation where natural gas will continue to be thought of as a potential value play, at least on each and every dip.

The Cycle

The cycle will end sooner or later, but it is worth noting that the market participants out there will probably continue to push this market higher over the next month or 2. After a while, then you have to start looking at the futures markets that are pricing in spring temperatures, which obviously will start to warm up and therefore it makes a certain amount of sense that the market will start to fall again. This is something I do every year, and the share of course will be any different. The market had been somewhat straight up in the air for a while, so a little bit of consolidation between the $3.00 level and the $3.40 level, certainly makes a certain amount of sense. After all, the $3.40 level had been a massive barrier previously.

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SHANGHAI – Copper prices could fall towards $8 500 a metric ton within the next four months on expectations that demand will be hurt by potential trade disruptions when Donald Trump returns to the White House in January, copper industry participants said.

Benchmark three-month copper on the London Metal Exchange (LME) CMCU3 was traded at $8 915 a ton at 08:52 GMT, having shed 8% in less than 10 days since Trump won the US Presidential election.

The pressure on prices reflects heightened concerns around the impact on growth from potential trade policy from the new U.S. administration, analyst Nicholas Snowdon of Mercuria Energy Trading told the CRU World Copper Conference Asia.

Near-term prices are also being suppressed by the weight of inventory, Snowdon said, forecasting a surplus of nearly half a million tons in the first quarter of 2025 due to stock build-up during the Chinese New Year holiday starting in late January and demand weakness in the West.

“It is quite feasible that by March, we will be sitting on global cathode stocks of just over a million tons,” he said.

LME copper could fall to $8,500 by the end of the first quarter next year, most traders, producers, brokers and analysts surveyed by Reuters said during the annual copper industry gathering this week in Shanghai.

Others at the event said they expect prices to range between $9 000 to $9 500 next year, citing similar fundamentals to 2024.

A strong dollar, boosted by its safe haven status, will also make dollar-priced copper more expensive to holders of other currencies, said a broker and an analyst.

Citi analysts on Wednesday revised down their copper price forecast to $8 500 a ton within three months, from $9 500 previously, due to likely US trade tariff hikes and weaker-than-expected Chinese stimulus so far.

But prices are unlikely to fall below $8 500 because buyers would snap up copper at that level, which is more than 20% below the historic high hit in May this year of $11 104.50, a China-based analyst said.

Project Blue analyst Jonathan Barnes said LME copper prices could average between $9 300 to $9 400 over the next three months, with a near-term dip towards $8 500 possible as markets digest the implications of a Trump presidency, with 2025 prices seen averaging between $9 475 and $9 575.

In the longer-term, prices are likely to be supported by demand driven by possible Chinese stimulus moves next year, analysts said.

Copper prices are also cushioned by disruptions in mine supply, with analysts forecasting a deficit next year to range from 500,000 tons to above one-million tons, forcing smelters to cut cathode output.

CRU expects the copper price to recover to $10 000 by the end of March 2025 and potentially hit $15 000 by 2029, backed by energy transition demand and mine supply tightness.

“In the near term (there is) downside risk for price, but the structural story is not dead … and we do see that starting to prevail more through the mid-second half of next year,” Mercuria’s Snowdon said.

• Gold price stays supported near $2,650 ahead of US data and Fed Chair Powell’s speech.    
• The US Dollar derives strength from risk aversion on China’s woes and the Fed’s future rate cuts uncertainty.
• Technically, Gold price regains the 21-day SMA at $2,636, but the daily RSI flatlines near 50.

Gold price is holding onto minor bids early Wednesday, struggling to build on the previous bounce, anticipating a fresh batch of top-tier US economic data releases and Federal Reserve (Fed) Chairman Jerome Powell’s speech.   

Gold price looks to US ADP data and Powell for fresh cues

Tuesday’s US JOLTs Job Openings data indicated a stronger-than-expected labor market after rising to 7.744 million in the reported period. Data surpassed the expected 7.48M increase. The upbeat labor data from the US briefly lifted the US Dollar (USD) across the board, capping the Gold price rebound near $2,655.

However, Gold buyers retained control as the Greenback failed to sustain the uptick. The data failed to alter the market’s expectations of a 25 basis points (bps) interest rate cut by the Fed later this month. Markets are currently pricing at a 73% probability of a Dec Fed rate reduction, the CME Group’s FedWatch Tool shows, more or less the same as a day ago.

In Wednesday’s trading so far, Gold price is struggling to extend its upside as the USD remains in demand due to a risk-averse market environment. China’s economic concerns and US-Sino trade tensions continue to dent risk sentiment. China’s Caixin Services PMI unexpectedly dropped to 51.5 in November against the expected increase to 52.5 following October’s 52.0 figure.

On Tuesday, China’s Commerce Ministry announced a ban on exports of dual-use items related to gallium, germanium, antimony and superhard materials to the US with immediate effect, in response to the latest crackdown on China’s chip sector by US President Joe Biden’s administration.          

If risk-aversion intensifies, Gold price could face a tailwind effect as it is considered a traditional safety net. However, the next directional move in Gold price hinges on the US ADP Employment Change data and Fed Chair Powell’s speech. The US private sector is expected to see a job gain of 150K in November, compared to 233K in October.

A worse-than-expected labor data could revive expectations of future Fed rate cuts beyond December, fuelling a fresh advance in the non-interest-bearing Gold price. But any reaction to the US data is likely to be shorted-lived as Powell’s words are set to shape up the market expectations of the Fed’s easing trajectory, influencing Gold price action in the lead-up to Friday’s US Nonfarm Payrolls data.

It’s worth mentioning that it will be Powell’s last appearance before the Fed enters the ‘blackout period’ on December 7 ahead of the December 17-18 policy meeting.

Gold price technical analysis: Daily chart

The daily chart shows that Gold’s price extends its struggle with critical short-term 21-day Simple Moving Average (SMA), now at $2,636.

The 14-day Relative Strength Index (RSI) sits listlessly beneath the 50 level, indicating a lack of clear directional bias.  

However, the previous week’s Bear Cross warrants caution for Gold buyers.

Therefore, Fed Chair Jerome Powell’s words are likely critical for the next directional move in Gold price.

Recapturing the 21-day SMA support-turned-resistance at $2,636 is critical for buyers to revive the recovery momentum.

The next relevant resistance aligns at the 50-day SMA at $2,669, above which the $2,700 level will be in sight.

On the downside, Gold sellers need to crack the $2,621 static support to challenge the previous week’s low of $2,605.

A sustained break of that level could expose the 100-day SMA at $2,579.

XAU/USD Current price: $2,647.80

• Geopolitical tensions in South Korea and France undermined the market’s mood.
• The US reported higher-than-anticipated job openings in October, according to the JOLTS report.
• XAU/USD is neutral-to-bearish in the near term, a directional breakout not yet in sight.

The US Dollar (USD) gained upward traction during American trading hours after spending the first half of the day on the back foot amid a better market mood. XAU/USD retreats from an intraday high of $2,655.50 but retains the $2640 mark at the time of writing, as the USD benefits from a deteriorated market mood.

The market sentiment deteriorated following the release of the United States (US) Job Openings and Labor Turnover Survey (JOLTS) Job Openings report, showing the number of openings in the last business day of October stood at 7.74 million, according to the report released by the US Bureau of Labor Statistics (BLS). The reading was higher than the 7.37 million openings in September and beat the market expectation of 7.48 million.

Fresh geopolitical tensions in Asia also undermine the mood. South Korean President Yoon Suk Yeol declared martial law. The army closed the Parliament while representatives voted to block the president’s declaration. The SK Won plunged vs the USD, providing the latter with fresh impetus. News coming from France are no better. The minority government seems to be on the brink of collapse, as opposition lawmakers from the left and the far right vowed to topple Prime Minister Michel Barnier’s Cabinet, according to AP news.

Meanwhile, US indexes trade in the red. Asian and European equities advanced, limiting USD strength, but Wall Street could not follow the lead. Even further, US government bond yields are back on the rise, underpinning the American currency.

Other than that, investors await more US employment-related data scheduled throughout the week. The November ADP report on private job creation is expected to show that 150K new positions were created in the sector on Wednesday. The most relevant figures will be out on Friday when the US will release the Nonfarm Payrolls (NFP) report.

XAU/USD short-term technical outlook

From a technical point of view, the daily chart for XAU/USD shows the pair is pretty much unchanged from its opening and still confined to familiar levels. The Momentum indicator aims higher above its 100 level, but the Relative Strength Index (RSI) indicator heads nowhere at around 48. At the same time, the XAU/USD pair barely holds above a bearish 20 Simple Moving Average (SMA) while the 100 and 200 SMAs keep advancing below the current level, losing their former strength but still aiming north.

In the near term, and according to the 4-hour chart, XAU/USD offers a neutral-to-bearish stance. The pair keeps hovering around a directionless 20 SMA while midway between also flat 100 and 200 SMAs. Finally, technical indicators turned marginally lower right below their midlines, lacking strength enough to confirm another leg lower.

Support levels: 2,626.70 2,611.35 2,598.70  

Resistance levels:  2,655.50 2,671.55 2,688.65

• Silver price climbs to around $30.90 in Tuesday’s early European session, up 1.24% on the day. 
• Silver crosses above the 100-day EMA, but further consolidation cannot be ruled out with the neutral RSI indicator. 
• The first upside barrier is located at $31.68; the initial support level is seen at $30.50.

The Silver price (XAG/USD) gains traction to near $30.90 during the early European session on Tuesday. The white metal edges higher due to the potential stimulus measures from China and ongoing geopolitical uncertainty. 

However, JPMorgan analysts expect a near-term downside for base metals in early 2025 due to potential US tariffs on Chinese goods but see a recovery later in the year, bolstered by stronger Chinese economic stimulus and improved valuations.

According to the daily chart, Silver is set to resume its upside as the price crosses above the key 100-day Exponential Moving Average (EMA). However, further consolidation cannot be ruled out as the 14-day Relative Strength Index (RSI) hovers around the midline, indicating the neutral momentum of the white metal. 

The immediate resistance level for XAG/USD emerges near the upper boundary of the Bollinger Band of $31.68. Any follow-through buying above this level could pave the way to the $32.90-$33.00 zone, representing the psychological level and the high of November 5. The additional upside filter to watch is $34.55, the high of October 29. 

In the bearish event, sustained trading below $30.50, the 100-day EMA, could see a drop to $29.65, the low of November 28. A breach of the mentioned level could expose $27.70, the low of September 9. 

Silver price (XAG/USD) Daily Chart

• Gold price nurses losses below $2,650 early Tuesday, awaits US JOLTS survey for fresh impetus.   
• US Dollar recovers from Fedspeak-induced pain as market mood sours on China concerns, looming Trump tariffs threat.
• Technically, Gold price stays below the 21-day SMA at $2,641 with a bearish daily RSI.

Gold price is nursing losses below $2,650 in Asian trades on Tuesday, though remaining in the recent range, awaiting the key US employment data for further trading directives. The US JOLTS Job Openings data will set off the critical week of top-tier labor data, offering hints on the US Federal Reserve’s (Fed) future interest rate cuts.

Gold price awaits US data for fresh cues on the Fed policy

The focus now seems to have shifted toward the sentiment surrounding the Fed policy outlook following the latest speeches from several Fed policymakers and ahead of Friday’s Nonfarm Payrolls (NFP) data.

The US Dollar (USD) returned to the red in American trading on Monday after Fed Governor Christopher Waller said that “policy is still restrictive enough that an additional cut at our next meeting will not dramatically change the stance of monetary policy and allow ample scope to later slow the pace of rate cuts, if needed, to maintain progress toward our inflation target.”

The Greenback erased gains from the first half of Monday’s trading, spurred by broad risk-aversion as traders took account of US President-elect Donald Trump’s weekend warning against the so-called ‘BRICS’ nations. Trump threatened 100% tariffs on Brazil, Russia, India, China and South Africa if they create a new currency or support another currency that would replace the Greenback.

However, the revival of the haven demand for the USD early Tuesday keeps Gold buyers on the back seat. Persistent China’s economic concerns and the global tariff threat from Trump remain a drag on investors’ sentiment.

The next direction in Gold price will likely hinge on the upcoming US employment data and their impact on the Fed rate cut expectations. Markets are currently pricing in a 75% probability of a 25 basis points (bps) rate cut later this month, the CME Group’s FedWatch Tool shows, up from about 65% seen a day ago. Dovish Fed expectations tend to benefit the non-interest-bearing Gold price.

Meanwhile, Gold traders also remain wary of the geopolitical tensions between Russia and Ukraine and Israel and Iran, which could have a strong bearing on the traditional safe-haven asset, Gold price.

Gold price technical analysis: Daily chart

Having closed below the critical short-term 21-day Simple Moving Average (SMA) support, now at $2,641, Gold buyers seem reluctant to step in.

The 14-day Relative Strength Index (RSI) sits beneath the 50 level, justifying the cautious approach.

The previous week’s Bear Cross also remains in play, adding to the downside risks in Gold price.

Gold sellers need to crack the $2,621 static support to challenge the previous week’s low of $2,605.

A sustained drop below that level could expose the 100-day SMA at $2,577.

Conversely, recapturing the 21-day SMA support-turned-resistance at $2,641 is critical to reviving the recent recovery.

The next relevant resistance aligns at the 50-day SMA at $2,669, above which the $2,700 level will be on buyers’ radars.

Will Support at 3.16 Prior Swing High Hold?

Previous resistance around the June peak of 3.16 was tested as support today. It has stalled the decline so far, but whether it continues to do so remains to be seen. The 50% retracement level is at 3.13, and it was almost reached today. Although natural gas has reached a price zone where support may be seen there is no sign of increasing demand or a bullish reversal. Therefore, the expectation is for a continuation lower upon a decisive drop below today’s low.

Lower Target Zone From 3.04 to 2.90

If natural gas does fall below today’s low and continues to decline, then previous resistance from the 3.02 swing high may be the next area of support. However, there are price levels nearby to be aware of as well. One guide is provided by the internal uptrend line. But clearer price levels where support may be seen are from 3.04 to 2.90.

A falling ABCD pattern (purple) reaches its 100% downside target around 3.04. Then there is both a prior swing high and the 61.8% Fibonacci retracement at 3.02. And most importantly, the 20-Day MA is at 3.01. The 20-Day line has been successfully tested twice as support since it was reclaimed on October 29.

First Signs of Bullish Reversal Above 3.28

There is also the possibility that the day’s low price completed a retracement. If that is the case a decisive rally above today’s high of 3.28 indicates improving demand. Friday’s high of 3.38 would then need to be reclaimed for further signs of strength. Since natural gas is within the first pullback following a decisive bull breakout, it presents an interesting potential setup that will be watched closely by market participants.

It is currently within the first pullback following a significant breakout. On November 20 natural gas busted through the 3.02 swing high resistance level and triggered a breakout of a symmetrical triangle pattern and the continuation of the uptrend begun from the 2024 low of 1.52.

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

XAU/USD Current price: $2,641.31

• Upbeat United States data fueled demand for the USD in a risk-averse environment.
• Investors await US employment-related updates ahead of the NFP release next Friday.
• XAU/USD trades with a soft tone, but holds within familiar levels.

Resurgent US Dollar strength weighed modesty on Gold price, with XAU/USD posting intraday losses. The pair hovers around $2,640 in the American session and aims to extend its slump following better-than-anticipated United States (US) data.

S&P Global released the final estimate of the November Manufacturing Purchasing Manager Index (PMI), upwardly revised to 49.7 from the preliminary estimate of 48.8. The official ISM Manufacturing PMI for the same month printed at 48.4, better than the 47.5 expected and the previous 46.5.

Meanwhile, Wall Street trades mixed, with the Dow Jones Industrial Average down over 100 points, but the S&P500 and the Nasdaq Composite up for the day. The sentiment soured on weekend news, pointing to political turmoil in France and mounting tensions between the US and Russia after President-elect Donald Trump threatened to impose tariffs on BRICS countries over the weekend.

Attention this week will be on US employment data, as the country will release multiple job-related figures ahead of the Nonfarm Payrolls (NFP) report on Friday.

XAU/USD short-term technical outlook

From a technical point of view, XAU/USD remains confined to familiar levels, still struggling to find a directional way. In the daily chart, the pair struggles around a mildly bearish 20 Simple Moving Average (SMA) while the 100 and 200 SMAs maintain their bullish slopes well below the current level. Technical indicators, however, have turned flat at around their midlines, in line with the absence of a clear trend.

In the near-term, and according to the 4-hour chart, XAU/USD is neutral-to-bearish the bright metal stands below a flat 20 SMA while above an also directionless 100 SMA not far below the shorter one. The 200 SMA, in the meantime, stands in the $2,690 region, providing dynamic resistance. Finally, technical indicators turned lower around their midlines, lacking momentum enough to support a bearish continuation.

 Support levels: 2,626.70 2,611.35 2,598.70  

Resistance levels: 2,643.30 2,655.00 2,671.55