Gold (XAUUSD) and Silver Technical Analysis Amid Strong US Jobs Data and Rising Yields

Gold (XAUUSD) prices dropped on Tuesday from a daily high of $3,392 to $3,333. This pullback followed strong US jobs data, signaling tight labor market conditions. The JOLTS report showed job openings rose to 7.39 million in April, well above expectations of 7.10 million. This strength supported the US Dollar, with the Dollar Index rising to 99.22. The stronger US Dollar pushed gold prices down to $3,333.

The rising US Dollar and bond yields also weakened gold’s short-term outlook. The US 10-year yield increased to 4.462%, while real yields rose to 2.132%. These gains in yields reduce the appeal of non-yielding assets like gold. However, uncertainty around US-China trade tensions provided mixed signals and pushed gold prices back above $3,370 on Wednesday morning. Rumors of a potential call between Trump and Xi Jinping briefly eased market fears. Still, the increase in tariffs from 25% to 50% on metals renewed inflation concerns, which could support gold in the medium term.

On the other hand, silver (XAGUSD) pushed above the $33.60 resistance and reached the $35 zone. Higher tariffs on industrial metals like steel and aluminum raise inflation risks, often boosting silver’s appeal as a precious and industrial metal. However, rising bond yields and a stronger US Dollar could limit silver’s upside in the short term. Gold and silver remain sensitive to upcoming US labor reports and Federal Reserve rate cut expectations, priced at 48.5 basis points of easing by year-end.

Gold Technical Analysis

XAUUSD Daily Chart – Breakout

The daily chart for spot gold shows that the price trades within an ascending broadening wedge pattern. The breakout from the descending channel inside this structure has opened the door for a move toward the $3,500 region. Moreover, the RSI is rebounding from the mid-level, indicating bullish momentum.

XAUUSD 4-Hour Chart – Breakout

The 4-hour chart for spot gold shows a descending broadening wedge pattern, with the price breaking out at the $3,360 level. This breakout pushed the price toward the $3,400 resistance area. After hitting this level, the price corrected back toward the breakout zone.

The rebound from this zone has opened the door to higher prices. Strong resistance remains at the $3,400 and $3,500 levels. The emergence of an inverted head-and-shoulders pattern at the bottom of the descending wedge further indicates bullish momentum.

Silver Technical Analysis

XAGUSD Daily Chart – Positive Price Development

The daily chart for spot silver shows that the price has broken above the $33.60 level after consolidating in a tight range. This consolidation above the 50- and 200-day SMAs indicates strong bullish momentum and increases the likelihood of a breakout above the $35 region. Moreover, the RSI remains below 70, suggesting room for further upside.

XAGUSD 4-Hour Chart – Positive Price Development

A strong positive development is also visible on the 4-hour chart. The price shows strong bullish action at the $31.80 support level. A breakout above $33.60 suggests a move above $35 could trigger a strong rally to the upside.

US Dollar (DXY) Technical Analysis

US Dollar Daily – Bearish Pressure

The daily chart for the US Dollar Index shows strong bearish pressure below the 50-day SMA. Multiple rejections at the 50-day SMA and monthly closes below 100.65 indicate that the index will likely break below the 98 region. A break below 98 would open the door for a slide toward the 90 area.

US Dollar 4-Hour Chart – Descending Channel

The 4-hour chart for the US Dollar Index shows that the index is trading within a descending channel. The rejection at 101.60 suggests that the index will likely continue moving lower. Strong support lies near the 96 area, which marks the bottom of the descending channel.