Gold and Silver Price Forecast: Price Compression Builds Ahead of NFP Data

Gold (XAU) prices pull back on Friday as investors avoid risk ahead of the U.S. nonfarm payrolls report. The price also fell for the week as optimism over a U.S.-Iran peace deal waned. The escalation of tensions in the Middle East is a strong boost to gold in the long term. But the market is more focused on inflation and higher interest-rate risk in the short term. This has kept the gold prices under pressure.

The primary pressure comes from the Federal Reserve’s forecast. Kansas City Fed President Jeffrey Schmid cautioned that the Fed might have to be patient or even raise rates again if the inflation is too high. San Francisco Fed President Mary Daly also maintained that the Fed policy depends on the incoming data. This leaves room for traders to not make a clear decision until more data is available. Therefore, the NFP report will make all the difference in whether gold has support or continues the downward trend over the week.

Silver (XAG) also shows pressure around the support zone of $70-$72. This weakness is due to the continued sell off in precious metals ahead of the big U.S. jobs data.

Gold Price Forecast: Price Compression Builds Before Breakout

XAUUSD Consolidates Between 50-Day and 200-Day SMAs

The gold price consolidates in tight range between the 50-day and 200-day SMAs. This consolidation indicates price compression. This consolidation has been taking place since mid-May 2026 and prices have failed to break these moving averages to find the next move.

But the 50-day SMA is now neutral, which suggests that a break above $4,650 will likely push gold prices towards the $5,000 resistance area. But a break below $4,350 will likely take prices towards the $4,000 area.

Despite this price compression, the broader consolidation of the gold price remains between $4,000 and $5,000. The next move in gold depends on a break of any of these levels.

Gold Price Breakout Depends on $4,350–$4,650 Range

The 4-hour chart also highlights the price compression. The chart shows that the prices have been declining since the peak on 17 April 2026 and are now approaching the $4,350.

The descending trend line from the 11 May 2026 high is now approaching the $4,520 level. This level indicates the important resistance in the short term. A break of this compression from $4,350 or $4,520 will likely introduce the next move in the gold market. A daily close above $4,650 will likely confirm the next rally.

Silver Price Forecast: Waits for Range Breakout

XAGUSD Compression Builds Between $72 and $79

It is interesting to note that silver prices also show price compression between the $72 and $79 area as seen in the chart below. The price has failed to break below the strong support of $72. This has been a key level for further downside. But the failure at the $89 level on 13 May 2026 indicates negative pressure and highlights that silver must move towards the $50 to $60 area to complete this correction.

The price must break $70-$72 in the short term to push prices downward towards the $50 to $60 area. A strong recovery above the $79 level after the US employment data will open the door for further upside towards the $89 level.

Silver Price Direction Depends on $72–$79 Breakout

The 4-hour chart also highlights the price compression between $79 and $77. The chart shows that prices remain uncertain with no clear direction. The market is looking for events to define the next move. A break of $79 will push prices towards the $89 level. But a break below $72 will likely indicate further downside towards the $50 to $60 area.

Another silver short-term chart shows this consolidation between $78.60 and $70. But the overall picture for silver remains bearish.

Bottom Line

Gold and silver remain in narrow trading ranges and wait for the release of the U.S. nonfarm payrolls report to make the next decision. These trading ranges have produced a price compression which indicates that the move in both metals might be bigger if a breakout develops.

The gold price is currently in a bear market below $4,650. The market must break below $4,350 to initiate a drop to $4,000. On the other hand, silver will remain in a trading range of $72-$79 range. A break of this range will move the silver market. A break above $79 will push the silver price to $89, but a break below $72 will keep the silver under pressure. The movement of oil prices still drives the precious metals market in the short term, but the metals require a breakout confirmation to move prices.

Read more: NFP Data to Decide Next XAU/USD Breakout