Gold and Silver Technical Analysis: Inflation Risk Keeps Metals Under Pressure

Gold (XAU) prices dropped on Monday as anxiety about inflation returned. Spot gold fell to $4,595 due to the pressure from rising oil prices and uncertain outlook for U.S. monetary policy. The oil eased as Trump declared an attempt to free stranded ships in the Strait of Hormuz, but crude still held above $100. This is important to gold as high cost of oil can continue to push inflation. If inflation remains hot, the Federal Reserve may keep the interest rates higher for longer.

The U.S.-Iran peace talks are the most important driver of gold and silver. Washington has already forwarded its reply to the Iranian offer through Pakistan and Tehran is currently discussing it. This keeps the market cautious. Fed officials were also on their guard. Neel Kashkari warned that the Iran war might extend longer and thus lead to inflation and damage the economy. Austan Goolsbee also reported that the recent data on inflation was not good news for Fed.

The chart below shows that PCE and core PCE inflation rose to 3.5% and 3.2% in April 2026. As long as the Strait of Hormuz remains closed, inflation will further pick up in May and June.

The silver (XAG) remains slightly stronger than gold as the spot silver price remains above $75. This strength is due to the silver’s exposure to industrial usage. But silver is also under pressure from higher rates. Silver could not continue to rally if oil continues to keep inflation high and the Fed remains hawkish. Nevertheless, silver may outperform gold in the event of a better risk sentiment and a solid demand in the industry.

Gold Technical Analysis: $4,400–$4,500 Zone Holds the Key

The daily chart for spot gold shows that the price rebounded from the support of $4,500 last week. But the overall price action for gold remains negative. The decision zone of $4,400 to $4,500 remains the key level which may decide the next move in the gold market.

Any drop below $4,400 will push the price to the 200-day SMA at $4,280. Despite this short term bearish pressure, the overall picture for gold remains strongly bullish if the price holds $4,000.

The 4-hour chart for spot gold also shows that the drop from $5,600 has formed multiple waves since January 2026. Now, the consolidation below $5,000 is constructing rounding pattern and indicates further downside toward $4,400. A recovery above $5,000 will negate this pattern and indicate further upside in the gold market.

Silver Technical Analysis: $70 Support Keeps Bulls in Control

The daily chart of spot silver also shows strong consolidation in the short term. The formation of bullish hammer candles on 23 March 2026 from the long-term support zone has induced consolidation between $82 and $72.

As long as the $70 level holds, the silver price may introduce further upside toward $80. But a break below $70 will trigger another drop toward the orange zone between $55 and $60. As long as the price holds the $50 level in the silver market, the next move will likely be higher.

The 4-hour chart for spot silver also shows consolidation within the negative territory below the support line of the ascending broadening wedge pattern. If the price fails to recover above the $80 area in the short term, then the possibility of a breakdown in silver will likely be higher. However, any drop toward the $50 to $60 level will be considered a buying opportunity.

Bottom Line

In conclusion, gold and silver continue to feel the heat as oil related inflation keeps the Federal Reserve on the alert and delays rate cuts. Gold continues to have short term weakness as it trades below $5,000. The zone of $4,400 -$4,500 is critical area to observe. A break below this area may see gold slide towards the 200-day SMA around $4,280. On the other hand, a break above $5,000 will enhance the bullish picture. Silver appears to be stronger than gold due to its industrial demand, but it also needs to maintain $70 to keep the bullish momentum.

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