Gold (XAUUSD) and Silver Technical Analysis Amid Safe-Haven Flows and Uncertainty

Gold (XAU) price increased on Tuesday, reaching its highest level since October 23. This rally was driven by investor expectations that the Federal Reserve may cut interest rates in December.

Additionally, weak jobs data and a historic decline in consumer sentiment have further fueled the rally. The chart below shows that the US consumer sentiment has dropped to 50.3, which is the historical level.

The gold price tends to strengthen when interest rates drop. According to the FedWatch Tool, there is a 67.9% probability of a rate cut in December, which could continue to support demand for gold.

On the other hand, the U.S. dollar weakened as political uncertainty eased following a deal to end the government shutdown. The resumption of key economic data releases may confirm a softening economy. This increases the likelihood of Fed easing, an outcome that typically weighs on the dollar. While Fed officials remain cautious, voices like those of Governor Stephen Miran now suggest that a 50-basis-point cut could be on the table.

Moreover, safe-haven demand continues to support gold and silver (XAG). UBS expects gold demand to reach its highest levels since 2011. Any renewed political or financial volatility could drive gold toward $5,000 per ounce.

Similarly, other precious metals also gained this week, with silver approaching new record levels after forming strong support around the $45 region. Platinum (XPL) and palladium (XPD) also posted notable advances during the week. The combination of macroeconomic uncertainty and growing speculation over rate cuts continues to lift precious metals across the board.

Gold Technical Analysis

The weekly chart for spot gold shows that the price has been trading within an ascending channel. However, the surge in Q3 2025 pushed prices above the extension of this channel near the $4,400 region.

After this extended move, a strong correction followed, forming a bottom around the $3,900 support and initiating a solid rebound. In the short term, the price is now challenging the key $4,150 level, and a breakout above this level is required to push prices higher.

Since gold remains within a well-defined ascending channel, the overall trend is strongly bullish. Moreover, the ongoing economic and geopolitical crises may push gold to new highs heading into next year.

The 4-hour chart for spot gold shows that the price formed a strong bottom above $3,900 and broke out above the $4,030 level. Following this breakout, the price advanced into the resistance zone, reaching the lower boundary of that zone around $4,150. After hitting this resistance, gold is now consolidating as it searches for its next directional move.

As long as the price holds above $4,030, the short-term bias remains bullish. However, a clear breakout above the $4,150–$4,200 region is necessary to trigger a further rally toward the $4,400 level.

Overall, the current consolidation is a healthy development. The pause below $4,400 is constructive and suggests that the market is stabilising before a potential breakout.

Silver Technical Analysis

The daily chart for spot silver shows that the price remains in a strong short-term bullish trend. It rebounded from the key support level at $45, which aligns with the 50-day SMA. This rebound also led to a breakout above the critical $49.30 level, pushing prices to a higher level.

A breakout above the $54 level would confirm a strong bullish signal and could initiate a decisive upward move. The formation of an inverted head and shoulders pattern in Q3 2024, followed by an Adam and Eve pattern in Q1 2025, has established a solid base structure. This suggests that silver is likely to maintain its bullish momentum over the coming months.

Additionally, silver is now testing the key long-term resistance at $50-$55. A decisive breakout above this zone is expected to trigger a strong rally. The RSI is also rebounding from mid-levels, indicating strengthening bullish momentum. A sustained break above $54.50 would likely extend the rally toward the $60 level.

The 4-hour chart for spot silver shows that the price has formed an inverted head and shoulders pattern, with the neckline at the $49.30 level. A breakout above this neckline has triggered a gradual move higher. However, the price is currently consolidating around the $51.40 level, signalling some uncertainty before the next move.

A breakout above $52.60 would suggest that silver is likely to challenge new record highs. On the other hand, a drop back below $49.30 would keep the market in a consolidation phase.