Gold and Silver Price Forecast: NFP Data and Iran Talks Drive Next Breakout

Gold (XAU) prices consolidate around the $4,070 on Monday as traders react to fresh uncertainty around the US-Iran talks. The situation remains fragile as the US and Iran agreed to hold talks in Qatar on Tuesday and temporarily pause attacks. That leaves markets cautious as any renewed tensions around the Strait of Hormuz could push oil prices up and ignite inflation concerns.

The risk premium also remains alive due to Iran’s position. Foreign Minister Abbas Araghchi said that Tehran has sole responsibility for the Strait of Hormuz. An Iranian official also warned that any bypass of Iran’s preferred path may lead to further escalation. This is relevant to gold as rising geopolitical risk levels can boost safe haven demand. But rising inflation expectations can lift the interest rate outlook, which may limit the short-term rallies in the gold market.

The expectations of higher interest rates are the top reason for the lack of momentum in the gold market. Traders now view the likelihood of rate hike in September 2026. These expectations keep the US dollar strong in the short term. The markets are now relying on the US Nonfarm Payrolls data from Thursday. A strong labor market report may add to the rate-hike expectations and hurt gold further. But the softer data could help prices bounce from support.

Gold Price Forecast: $3,950 Support Tested as Fed Rate-Hike Bets Rise

XAUUSD Daily Chart Shows Weak Rebound

The daily chart for spot gold shows that the price has reached the targeted range of $3,900 to $4,000 as discussed in the previous article. The low was formed at $3,959 and the price rebounded higher last week. This target was defined after the breakout of the ascending broadening wedge pattern at the $4,500 region.

However, the 50-day SMA is crossing below the 200-day SMA, which indicates a short-term bearish signal for the gold market. This suggests that if prices fail to break above the $4,500 region, then prices may continue to drop further before the next big rally. But a successful breakout above $4,500 will likely indicate a strong trend in the gold market.

The strong support in the spot gold market at $3,950 is also seen by the support of the triangle pattern. The rebound so far has been weak, but a daily close above $4,350 will strengthen the short-term outlook. On the other hand, a break below $3,950 will likely trigger another drop. The RSI is also consolidating around the oversold level.

XAUUSD 4-Hour Chart Keeps $4,350 as Key Resistance

The 4-hour chart for spot gold also shows bearish pressure in the short term as the price consolidates below the red highlighted region. As long as the price remains below $4,350, the bearish pressure will likely persist in the spot gold market. A break below $3,950 will signal further downside in the short-term.

Silver Price Forecast: $55 Support Tested as Buyers Watch Support Zone

XAGUSD Daily Chart Shows Rebound from $55

The daily chart for spot silver (XAG) shows a strong rebound at the $55 area which is the lower boundary of the primary support zone. A break below $55 will likely push silver prices towards the major accumulation zone between $45 and $55.

A strong recovery in silver is expected once the price reaches the major accumulation zone. The spot silver price needs to recover above $72 to confirm a bottom and initiate a rally towards the $90 area. As long as the spot silver price remains above the $45 area, the next move will likely be higher.

Silver 4-Hour Chart Shows Pressure Below $60

The 4-hour chart for spot silver also shows that the price has broken $60 in the short term, which indicates short-term pressure. As long as the price remains below $60, it may remain weak and consolidate towards the $45 to $50 area in the short term. A strong recovery above $72 is required to initiate bullish momentum in the silver market.

Bottom Line

The sentiments in gold and silver remain negative due to the geopolitical uncertainty, inflation concerns, and hawkish Fed expectations. The price shows a weaker recovery from the support of $3,950. As long as the gold price remains below $3,950, the possibility of breaking below $3,950 will increase. But a break above $3,950 will will open the door for further upside. On the other hand, the spot silver remains under pressure as long as the price remains below $60. But the support zone of $45-$55 is a major accumulation zone for investors. The silver must break above $72 to open the door for a rally to $90.

Read more: Gold Defends $3,950 as Hormuz Risk Supports Rebound