Gold and Silver Technical Analysis: Consolidation Holds as Markets Await US PCE Inflation Data

Gold (XAUUSD) pulled back on Thursday despite ongoing weakness in the US Dollar. The retreat came as traders shifted focus toward risk assets, driven by a bullish mood in global equity markets. The recent rally in US equity indices has led to limited demand for safe-haven assets, such as gold.

On the other hand, silver (XAGUSD) is also following gold’s correction. While a softer dollar supports precious metals, the ongoing consolidation reflects investor uncertainty. Silver remains above key support levels but lacks the momentum to break higher. Without a fresh catalyst, it may continue to drift sideways in the short term.

Macroeconomic factors remain the key drivers for gold and silver prices. Market attention has shifted toward US monetary policy and the ongoing dialogue between President Trump and Fed Chair Powell. Although the Fed has kept rates unchanged, pressure is building as inflation approaches the 2% target. President Trump’s recent remarks have drawn additional focus to the rate cut discussion, which could support gold and silver if expectations materialize.

The US PCE inflation data is set for release on Friday. This data will be crucial for the next move in the gold market. A softer reading could revive hopes for a September rate cut, further weakening the dollar and reigniting rallies in gold and silver. On the other hand, signs of stronger inflation may delay Fed action and continue to put pressure on precious metals.

Gold Technical Analysis

XAUUSD Daily Chart – Correction

The daily chart for spot gold shows strong uncertainty near the edge of the ascending triangle. Support is currently reinforced by the 50-day SMA, while the price searches for direction.

A break below $3,280 may signal a deeper correction in the bullish trend, whereas a break above $3,450 would suggest a strong upward surge.

Despite the ongoing correction, the overall price structure remains bullish. However, a break below $3,280 may invalidate the ascending triangle structure.

XAUUSD 4-Hour Chart – Correction before US PCE Inflation Data

The 4-hour chart also shows that the price is consolidating within a descending channel after forming a strong bullish structure above the 3,230 area.

The price needs to sustain above $3,280 to remain bullish and must break above $3,400 to confirm upward momentum.

The overall structure indicates strong consolidation between the $3,000 and $3,500 zones. A breakout above $3,500 would likely trigger the next strong rally.

Silver Technical Analysis

XAGUSD Daily Chart – Correction

The daily chart for spot silver indicates that the price has continued to rise after correcting toward the $35 area. Strong consolidation around the $36 level suggests that silver may move higher. The price needs to hold support between the $34 and $35 region to initiate a strong move toward the $38 area.

XAGUSD 4-Hour Chart – Bullish Momentum

The 4-hour chart for spot silver shows that the price is consolidating above the orange zone and is poised for the next move higher. The strong rejection at $35.30, followed by a rebound above the $36.80 area, indicates bullish momentum. A breakout above $37.30 would likely trigger the next strong upward move.

US Dollar Index Technical Analysis

US Dollar Daily – Bearish Pressure

The daily chart for the US Dollar Index shows strong bearish pressure after failing to hold above the 50-day SMA near the 99.30 zone. The inability to break above the 100.65 level, followed by a drop below 98, suggests that the USD may continue to decline. A break below 96 could trigger a sharp fall toward the 90 area.

US Dollar 4-Hour Chart – Descending Channel

The 4-hour chart for the US Dollar Index shows that it remains within a descending channel and has failed to break above the 99.30 area. The index is now trading toward the 95 support level, which aligns with the lower boundary of the descending channel. Failure to maintain this support could result in a continuation of significantly lower levels.