Gold (XAU) Silver (XAG) Daily Forecast: Fed Caution Lifts Safe-Haven Demand as Metals Rebound

Market Overview

Gold extended its advance in early European trading on Wednesday, building on its two-day recovery as investors reassessed the outlook for the US economy. The move comes after a notable decline on Wall Street, where major equity benchmarks slipped amid concerns that prolonged government gridlock and weakening macro indicators could restrain economic activity into year-end.

Market sentiment has been fragile since the record-long US government shutdown disrupted economic operations and delayed key data releases. The uncertainty has pushed investors back into defensive assets, with both gold and silver benefiting from renewed safe-haven positioning.

Metals are drawing support not only from domestic macro concerns, but also from broader geopolitical tensions that continue to underpin global risk aversion.

Dollar Strength Limited Despite Fed Signaling Caution

The US dollar has held near recent highs but failed to attract sustained upside momentum. Mixed communication from Federal Reserve officials has kept interest-rate expectations in flux. Vice Chair Philip Jefferson recently reiterated the need for caution before committing to further policy easing, while Governor Christopher Waller suggested that targeted rate reductions could help stabilize a slowing labor market. The divergence in tone has left traders uncertain about the Fed’s next move.

According to CME FedWatch, markets are pricing roughly a 45% probability of a December rate cut, down from earlier expectations. This hesitation has limited the dollar’s ability to mount a stronger rally, indirectly supporting gold and silver by keeping real yields capped.

Labor Market Data and Fed Minutes in Focus

Investors now await two key catalysts: the release of the FOMC minutes and the delayed Nonfarm Payrolls report. Weekly jobless claims have climbed to their highest in nearly two months, signaling that the labor market may be losing momentum. A softer NFP outcome would reinforce expectations that the Fed could pivot toward easing sooner than anticipated.

For precious metals, a slowing US economy paired with muted dollar strength creates a supportive backdrop. Silver, which often mirrors gold’s macro-driven moves while responding more sharply to industrial demand expectations, has tracked the broader uptick as manufacturing sentiment stabilizes globally.

Short-Term Forecast

Gold may retest $4,144, with momentum building toward $4,236 if buyers hold $4,054. Silver stays constructive above $50, eyeing $52.41 and potentially $53.28 on renewed strength.

Gold Prices Forecast: Technical Analysis

Gold is holding near $4,094, stabilizing after last week’s decline and defending the $4,054 support zone. The 4-hour chart shows price respecting the ascending trendline that has guided the broader advance since early November, keeping the structure constructive despite recent volatility.

The metal is now trading back above the 20-EMA, showing early signs of renewed short-term strength, while the 200-EMA sits just below price and continues to act as a secondary layer of support. The RSI has rebounded toward 50, indicating momentum is improving from oversold conditions without entering a stretched phase.

A move above $4,144 would confirm a shift in sentiment and open a path toward $4,236, followed by the key swing high at $4,334. If buyers struggle, gold may retest $4,054 or even slide back toward $3,996, where the trendline and previous support converge.

As long as gold continues to defend the ascending trendline, the outlook remains cautiously bullish. A clean break above $4,144 would strengthen the case for a broader recovery in the days ahead.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver is holding firm above the $50.06 support zone, where the rising trendline and buyers converged last week. The rebound has pushed price back above the 20-EMA, showing early signs of momentum returning. RSI has recovered from oversold conditions and now prints near 50, suggesting stabilization rather than exhaustion.

The immediate test sits at $52.41, a key resistance that capped the last rally. A close above it would expose $53.28, followed by the broader breakout target at $54.28.

If the trendline fails, downside risk opens toward the $48.45 level and then $46.86. For now, structure remains constructive as long as price holds above $50 and continues printing higher lows.