Gold and Silver Technical Analysis: Strong Dollar and Rising Yields Drive Prices Toward Key Support

Gold (XAU) and silver (XAG) prices remained under pressure last week as a result of strength in US dollar and Treasury yields. These factors lead to less demand for non-yielding assets such as precious metals. Investors shift capital to yield bearing assets which puts pressure on gold and silver. At the same time, markets respond to persistent geopolitical tensions and an increasing risk of inflation, which creates uncertainty and puts a cap on strong upside moves.

Moreover, profit taking also has an important role in the recent decline. After a good rally in 2025, many investors lock in gains which adds selling pressure in the short term. Silver often makes larger moves because of its industrial and monetary demand, which makes it more volatile when there is a shift in market sentiment.

The powerful underlying demand from inflation concerns and global uncertainty may support prices once this correction is over. If the dollar becomes weak or yields become stabilized, both gold and silver may rebound and move higher again.

Gold Technical Analysis – Key Support Holds as Downside Risk Builds

The daily chart for spot gold shows that the price plunged last week towards the strong support area of the $4,400 to $4,500 region. The negative weekly close last week increases strong uncertainty in the gold market for the upcoming week. The chart below confirms that the weekly close was below the 100-day SMA, while the short-term indicators show oversold conditions.

As long as the $4,400 to $4,500 region holds, prices may try to consolidate within red zone.

However, a break below $4,400 will trigger a strong drop towards the $4,000 region. Based on the negative price action last week, the short term price direction is tilted to the downside.

The strong support in the gold market is also observed using another chart, which shows support at $4,400. A break below $4,400 will target the $4,000 region, which is the 200-day SMA. A strong rebound from the $4,000 region is expected due to the strong support and extremely oversold conditions in the short term. A recovery above $5,000 will indicate that the bottom has been formed.

Silver Technical Analysis – Support Breakdown Signals Downside

Spot silver also followed negative price action during the last week. The daily chart below shows that silver price broke the $72 support for the first time since the record high at $120 was formed.

The immediate support at the $64 region is now weakening, and a break below $64 will initiate drop towards the $50 to $60 area, which is the strong long-term support.

The short-term price action is seen by the formation of an ascending broadening wedge pattern, which shows strong support around $70. However, the weekly close below $70 indicates that the price is moving towards the $50 to $60 area. However, the price remains within the red highlighted region, which is uncertain region.

Bottom Line

Gold and silver remained under pressure as strong macro forces and technical weakness coincide. Prices are testing important support levels and the short term momentum is in favor of the downside. A break below these levels may cause another leg lower. However, significant long term demand due to inflation and global uncertainty supports the overall bullish trend. If the dollar is weakened or yields are eased then both metals may find support and rebound from the current levels. The market is now waiting for confirmation, as support zones will dictate the next big move.

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