XAU/USD Current price: $2,669.02

• Generally encouraging US data gave the Greenback a short-term boost.
• Federal Reserve officials refrained from commenting on monetary policy.
• XAU/USD is poised to extend its advance, although the risk of a downward correction increased.

Spot Gold hit $2,685.45 on Thursday, yet another record high. XAU/USD currently trades around $2,671 as investors keep selling the battered US Dollar (USD). The United States (US) published some macroeconomic encouraging figures, albeit nothing shocking. The numbers provided temporal support to the USD at the beginning of the American session, but the Greenback quickly resumed its decline.

The US reported that  Initial Jobless Claims for the week ended September 20 rose by 218K, better than the 219K previous and the 225K expected. Also, the country confirmed an annualized pace of growth of 3% in the year to June, according to the final estimate of the Q2 Gross Domestic Product (GDP). Finally, Durable Goods Orders posted 0.0% in August, better than the -2.6% expected.

Meanwhile, multiple Federal Reserve (Fed) officials hit the wires in different events. Nevertheless, no one delivered fresh hints on monetary policy. In fact, most refrained from discussing it after cutting interest rates by a whopping 50 basis points (bps) when they met last week. Such silence left speculative interest in its belief that policymakers would deliver a similar trim in November.

Further harming the USD, Wall Street turned positive. After the back and forth offered in the first half of the week, US indexes seem to have found their way north.

XAU/USD short-term technical outlook  

The daily chart for XAU/USD shows it keeps posting higher lows and higher highs, supporting another leg north. Technical indicators, in the meantime, head firmly north within overbought levels, showing no signs of upward exhaustion yet, Meanwhile the pair keeps developing above firmly bullish moving averages which stand far below the current level. Overall, the risk of a downward correction has increased despite the lack of technical signs about it.

In the near term, and according to the 4-hour chart, it is clear that bulls retain control. An intraday slide met buyers around a bullish 20 Simple Moving Average (SMA), now providing dynamic support at around 2,650. At the same time, the 100 and 200 SMAs accelerated higher, far below the shorter ones, reflecting persistent upside strength. Finally, the Momentum indicator aims marginally higher within positive levels, while the Relative Strength Index (RSI) indicator retreats modestly from extreme overbought readings, drawing minor divergences. Such divergences seem not enough to support a decline but are a first warning about a potential decline in the upcoming sessions.

  Support levels: 2,662.80 2,650.00 2,638.10  

Resistance levels: 2,685.00 2,700.00 2,715.00

• Silver fails to build on the overnight modest rebound from the vicinity of mid-$31.00s.
• The technical setup supports prospects for an extension of the recent upward trajectory.
• Any meaningful decline might still be seen as a buying opportunity and remain limited.

Silver (XAG/USD) struggles to gain any meaningful traction and oscillates in a narrow trading band, around the $31.80-$31.85 region during the Asian session on Thursday. The white metal, meanwhile, remains within the striking distance of a four-month peak touched on Wednesday and seems poised to prolong the upward trajectory witnessed over the past two weeks or so.

From a technical perspective, the overnight sustained strength beyond the $31.40-$31.45 supply zone comes on the back of the recent breakout through a short-term descending trend-line resistance. This, along with the fact that oscillators on the daily chart are holding comfortably in positive territory and are still away from being in the overbought zone, validates the positive outlook and suggests that the path of least resistance for the XAG/USD is to the upside. 

Hence, a subsequent move beyond the $32.00 mark, towards retesting a one-decade top, around mid-$32.00s touched in May, looks like a distinct possibility. Some follow-through buying should pave the way for a further appreciating move towards conquering the $33.00 round-figure mark for the first time since December 2012.

On the flip side, weakness below the overnight swing low, around the $31.60-$31.55 region, is likely to find some support near the $31.25 area ahead of the $31.00 mark. A convincing break below the latter could drag the XAG/USD to the $30.60-$30.55 zone. The downfall could extend further towards the $30.00 psychological mark before the white metal drops to the $29.70-$29.65 area, or the descending trend-line resistance breakpoint, now turned support.

The latter now coincides with the 100-day Simple Moving Average (SMA) and should act as a key pivotal point, which if broken decisively will suggest that the XAG/USD has topped out in the near term and pave the way for a deeper corrective decline.

Silver daily chart

• Gold price keeps its range near record highs early Thursday, awaiting Fed Chair Powell.
• The US Dollar stalls the previous turnaround with Treasury bond yields, as risk rebounds.
• Extremely overbought conditions on the daily chart continue to caution Gold buyers.  

Gold price extends its consolidative mode just below the record high reached near $2670 on Wednesday, as buyers turn cautious in the lead-up to a raft of speeches from US Federal Reserve (Fed) policymakers due later on Thursday.

Will Powell speech trigger a sustained Gold price correction?

Amongst several Fed officials taking up the rostrum, Fed Chairman Jerome Powell’s pre-recorded opening remarks will hold the key for gauging the size of the next interest rate cut, especially with markets pricing in about a 62% chance that the Fed will reduce the rate by another 50 basis points (bps) in November.

The dovish Fed outlook was further endorsed by the recent commentary from Fed Governor Adriana Kuglar, who said during her overnight appearance that she “strongly supported” the Fed’s decision to cut the interest rates by a half point last week. Kugler added that she “will support additional rate cuts going forward.”

Recent Fedspeak combined with weak US Conference Board (CB) Consumer Confidence and regional activity data ramped up bets for another jumbo rate cut by the Fed at its next policy meeting.

The Fed’s dovishness and China’s stimulus optimism re-emerge early Thursday, checking the previous recovery in the US Dollar (USD) and the US Treasury bond yields while fuelling a minor Gold price uptick. The fate of Gold price hinges on the upcoming Fed commentaries, as traders refrain from placing further bets amid extremely overbought conditions on the daily chart.

Ahead of the Fedspeak, the US Durable Goods Orders, final Q2 Gross Domestic Product (GDP) and the weekly Jobless Claims will provide some trading incentives to Gold price. Risk sentiment will also play a pivotal role, as the focus will shift to Friday’s US Personal Consumption Expenditures (PCE) Price Index release after Powell’s remarks.  

Gold price staged a temporary pullback from all-time highs, as the US Dollar staged an impressive rebound from 14-month lows against its major rivals on fading Chinese stimulus-led market optimism. Traders also resorting to taking profits on the USD shorts ahead of the key speech by Fed Chair Jerome Powell.

Gold price technical analysis: Daily chart

Nothing changes for Gold price from a short-term technical perspective, as it remains in extremely overbought territory, suggesting that a meaningful correction could be in the offing.

The 14-day Relative Strength Index (RSI) flirts with the 76 level, at the moment.

If buyers regain lost momentum, acceptance above the record high near $2,670 is critical to unleashing further upside toward the $2,700 barrier.

Conversely, any correction in Gold price will likely test the September 24 low of $2,623, below which the $2,600 threshold will come into play.

Further south, Gold sellers could target the September 20 low of $2,585.

Short-term Pullback May Follow 2.67 High

If resistance continues to hold natural gas may pull back a bit before preparing for a continuation higher. It broke out of a bullish double bottom pattern two weeks ago on a move above 2.30. That advance also triggered a bullish reversal on the monthly chart. Further signs of strength were indicated as the rally exceeded the July high of 2.60 on Monday and it closed above it for the day.

Recent Signs of Strength

Following the breakout natural gas consolidated for some days before pulling back to test support at the 200-Day MA with last Thursday’s low of 2.22. Notice that the purple 20-Day MA has been rising and it now marks an area near that swing low as trend support. Also, the 20-Day line has also begun to converge with the internal uptrend line. Currently, the 20-Day line is at 2.31, close to the 2.30 breakout level. In addition, the orange 50-Day MA began to turn up this week. These are signs of strength particularly given the bullish reaction once support at the 200-Day line was tested.

Potential to Test Prior Breakout Level at 2.44

Today’s high is 2.56 and a decline below it may lead to a pullback to test lower potential support levels. The 38.2% Fibonacci retracement is at 2.50. It is followed by the 50% retracement at 2.45 along with the prior trend high of 2.44. A little lower is the 61.8% Fibonacci retracement at 2.39. The degree of pullback prior to a bullish reversal may provide insight into the potential for natural gas to eventually continue its ascent. Higher targets include the measuring objective from the double bottom pattern at 2.72.

May Eventually Approach Top Trendline

Natural gas has been rising from the second bottom established at 1.875 in late-August. That bottom generated a higher swing low and a new uptrend line with a higher slope than the lower trendline on the chart. The trendline along with the top downtrend line show natural gas progressing inside a developing symmetrical triangle pattern. Therefore, there is the potential for an eventual test of resistance near the top downtrend line. The 78.6% retracement is also nearby at 2.89.

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

• Silver drops 0.85%, retreating from a daily peak of $32.26, pressured by rising US Treasury yields.
• XAG/USD must decisively clear $32.00 for a bullish continuation toward the YTD high of $32.51.
• Failure to hold above $32.00 risks a slide towards $31.44, with $31.00 as key support.

Silver price retraces after matching the September 24 daily peak of $32.26 and drops beneath the $32.00 figure, losing over 0.85%, weighed by higher US Treasury yields. Also, a recovery of the US Dollar and investors’ reluctance to push the grey metal prices higher kept XAG/USD at familiar levels.

XAG/USD Price Forecast: Technical outlook

The uptrend on Silver remains in place, but price action suggests that buyers are struggling to keep the spot price above the $32.00 mark. During the year, XAG/USD has cracked the $32.00 barrier eight times, but after that, the non-yielding metal, dove.

For a bullish continuation, the XAG/USD must decisively clear the $32.00 mark. After that, traders need to test the year-to-date (YTD) high at $32.51, followed by the $33.00 mark. On further strength, XAG/USD could aim towards the October 1, 2012, peak at $35.40.

Conversely, if XAG/USD falls below $32.00, the next support would be the September 20 daily high at $31.44 before testing $31.00.

XAG/USD Price Action – Daily Chart

XAU/USD Current price: $2,653.99

• Geopolitical tensions undermined the market mood and helped the US Dollar.
• The focus remains on the United States inflation update scheduled for Friday.
• XAU/USD eased from fresh highs, but its bearish potential remains limited.

Spot Gold positive bias continued on Wednesday, as the bright metal traded as high as $2,670.43 a troy ounce. The XAU/USD pair retreated as the US Dollar gathered momentum within American trading hours, firmly up against most major rivals. Gold, however, remains resilient due to its safe-haven conditions, as Wall Street turned red, with the Dow Jones Industrial Average losing over 240 points at the time of writing.

The sentiment deteriorated rapidly by the end of the European session, helped by escalating geopolitical concerns. On the one hand, United States (US) President Joe Biden said that an all-out war is possible in the Middle East, but there is also the possibility of a settlement. Meanwhile, Russian President Vladimir Putin threatened once again with the use of nuclear weapons.

At the same time, the Organization for Economic Cooperation and Development  (OECD) maintained the US growth forecast for 2024 at 3.6% but downwardly revised 2025 progress to 1.6% from 1.8% previously. Finally, higher US Treasury yields are helping the USD on its way up.

Data-wise, the macroeconomic calendar remained scarce. Speculative interest keeps waiting for the US Personal Consumption Expenditures (PCE) Price Index to be released on Friday. The Federal Reserve’s (Fed) favorite inflation gauge is expected to show that price pressures continued to recede in August.

XAU/USD short-term technical outlook  

The daily chart for the XAU/USD pair shows it struggles around its opening and that a corrective decline is not out of the picture. Technical indicators retreated modestly but hold within overbought readings without downward strength. At the same time, the pair keeps developing above bullish moving averages, with the 20 Simple Moving Average (SMA) maintaining its firm upward slope over $100 below the current level.

The 4-hour chart shows XAU/USD entered a consolidative phase, while the risk of a downward extension seems limited. The 20 SMA keeps heading north at around $2,638, while the 100 and 200 SMAs extended their advances far below the shorter one. The Momentum indicator turned lower, although it holds far above its midline, while the Relative Strength Index (RSI) indicator turned flat at around 66, also suggesting absent selling interest.

Support levels: 2,652.60 2,638.10 2,623.25

Resistance levels: 2,670.00 2,685.00 2,700.00

In general, this is a market that has plenty of things to push it higher, but I don’t necessarily think that it’s got a huge run ahead of it. When you look at longer term charts, you see that the $3 level has been crucial multiple times, and as we approach it, I would expect some type of pullback unless of course a hurricane or a tropical storm actually shuts down production in places like Louisiana.

Even if that were to happen, that would have a short-term effect. We would probably get some type of pullback that you could buy into heading into the winter, and then you collect your profit. Remember, I am long of natural gas via an ETF, and now we’re getting to the point where I may close out even more of my position and just take my profit and go home. As far as jumping in here and buying, I mean, it could work out, but it is a little late for that.

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

Adds comments and closing prices

NEW YORK, Sept 24 (Reuters) –Arabica coffee futures on ICE rose to a 13-year high on Tuesday as worries over the crop in top producer Brazil persisted, compounded by fears there will not be enough rains in the country in the weeks ahead.

Raw sugar futures also gained, hitting a seven-month peak.

COFFEE

* December arabica coffee KCc1 settled up 4.15 cents, or 1.6%, at $2.678 per lb​, having hit the highest since September 2011 at ​$2.7040.

* Dealers said rains this past weekend in Brazil’s coffee growing regions might be enough to stimulate the first crop flowering, but follow-up rains will be needed to help fix the flowers into cherries.

* “This is where things get tricky,” said one dealer, noting the 11-15 day forecast has trended drier.

* Capping gains in coffee prices though were reports that the EU Deforestation Regulation banning the import of commodities linked to deforestation could be delayed, dealers said.

* The regulation is due to come into effect at the end of December, and has been boosting coffee imports into the bloc for much of this year.

* November robusta coffee LRCc2 rose 0.7% at $5,312 a metric ton.

SUGAR

* October raw sugar SBc1 ​​settled up 0.57 cent, or 2.5%, at 23.12 cents per lb, having hit a seven-month high of 23.30 cents.

* Dealers said the market continues to be supported by downgrades to projections for sugar output in top producer Brazil both this year and next due to the drought and related fires.

* A survey by S&P Global Commodity Insights expects sugar production in Brazil’s centre-south to have fallen 1.3% in the first half of September from last year. Industry group Unica is expected to release the data in coming days.

* December white sugar LSUc1 ​​rose 1.9% at $595.40 a ton.

COCOA

* December New York cocoa CCc1 ​​​settled up $81, or 1%, to $7,867 a ton.

* March London cocoa LCCc2 ​fell 0.7% to 4,526 pounds per ton.

Reporting by Maytaal Angel and Marcelo Teixeira; Editing by Emelia Sithole-Matarise and Daniel Wallis

Resistance Seen at Bottom of Triangle Formation

Resistance was seen around the rising trendline at the bottom of a large symmetrical triangle pattern. Today’s 73.52 high may end a counter-trend rally following a breakdown from the triangle formation three weeks ago given that a test of resistance at the line has occurred. At the same time, the 20-Day MA was recaptured three days ago, and today’s trading range is fully above the 20-Day line.

These are short-term signs of strength that may lead to a test of resistance at higher prices. The 61.8% retracement at 73.74 is the next higher price level to watch, while a breakout above that level is followed by potential resistance around the falling 50-Day MA (orange), currently at 74.94. Notice that the 50-Day line has converged with the internal downtrend line as they point to similar resistance levels.

Eventual Turndown Anticipated

Given the bearish breakdown of the triangle pattern, crude oil is anticipated to eventually find resistance and turn back down to retest recent lows and possibly go lower. The long-term downtrend line, which represents potential support, was approached on the recent decline to 66.65, but it was not hit. Therefore, if a bearish reversal ensues the trendline may eventually be approached. A 33-month low of 63.67 can be watched for now as a proxy for the trendline. Notice that the trendline has not been tested as support since June 2023.

Rally Above 50-Day MA Would Counter Bearish Above Bearish Implications

Regardless of the bearish implications from the symmetrical triangle breakdown, that would start to change on a daily close above the 50-Day MA. Along with the 50-Day line keep an eye on how the month ends. Given that September will be ending shortly, the monthly chart may also provide clues. It is currently set up as a potentially bullish hammer candlestick pattern with a high of 75.19. Therefore, holding above the 50-Day line puts the monthly high in range.

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

• Silver price surges to near $31.00 on Fed dovish bets, China stimulus and Mid East tensions.
• Fed officials remain concerned over the US labor market outlook.
• Silver price holds the downward-sloping trendline breakout

Silver price (XAG/USD) climbs to near $31.00 in Tuesday’s European session. The white metal gains as on firm speculation for the Federal Reserve (Fed) 50 basis points (bps) interest rate cut in November, the announcement of monetary stimulus by China, and escalating Middle East tensions.

According to the CME FedWatch tool, the likelihood of the Fed reducing interest rates by 50 bps to 4.25%-4.50% in November has increased to 51% from 29% a week ago. This has weighed on the US Dollar (USD). The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, falls to near 100.80. Historically, lower US Dollar makes the Silver price an inexpensive bet for investors.

Market expectations for Fed large interest rate cuts have strengthened as recent commentaries from policymakers have indicated that they are worried about deteriorating job growth.

Meanwhile, China’s top regulators have announced a slew of stimulus measure to uplift their economy. This would improve the demand for Silver as metal, given that it has applications in various industries, such as electric vehicles and wires and cables, etc.

In the Middle East region, escalating tensions between Israel and Lebanon’s Hezbollah has improved Silver’s demand as a safe-haven asset. Mid-East conflicts deepened after Israel’s airstrike in southern Lebanon on Monday.

Silver technical analysis

Silver price strengthens as it holds the breakout of the downward-sloping trendline from May 21 high of $32.50. Upward-sloping 20-day Exponential Moving Average (EMA) near $29.85 suggests that the near-term outlook of the Silver price is bullish.

The 14-day Relative Strength Index (RSI) strives to sustain in the 60.00-80.00. A bullish momentum would trigger if the oscillator manages to do so.

Silver daily chart