Gold (XAUUSD) and Silver Technical Analysis: Bullish Momentum Builds on Fed Rate Cut Bets

Gold (XAUUSD) gained as traders increased bets on US interest rate cuts. The metal touched its highest level since July 24 after weak hiring data fueled expectations for two cuts by year-end. Lower interest rates make gold more attractive because it does not yield interest.

Moreover, the political developments added to gold’s strength. President Trump is set to announce new Federal Reserve appointments, including a short-term replacement for Governor Adriana Kugler and a pick for the next Fed chair. Markets reacted cautiously, as uncertainty over the Fed’s direction supports safe-haven demand for gold. The removal of the U.S. Bureau of Labor Statistics chief further fueled questions about economic stability.

The combination of a weaker dollar, falling rate expectations, and political uncertainty creates a supportive backdrop for gold. Investors see the metal as a store of value when the dollar’s role is questioned. If the Fed signals aggressive easing in September, gold could extend gains beyond current highs. In this environment, bullish momentum remains intact, with potential for another test of record levels.

Gold Technical Analysis

XAUUSD Daily Chart – Consolidation

The daily chart for spot gold shows that the price has been consolidating between the $3,175 and $3,450 region. Within this range, the $3,250 area also serves as strong long-term support. Spot gold has risen from this support zone and closed above the 50-day SMA. This strength signals a potential move toward the $3,450 level. A break above $3,450 would take gold out of this range and trigger the next strong move higher.

XAUUSD 4-Hour Chart – Consolidation

The 4-hour chart for spot gold shows that the price is consolidating between the $3,250 and $3,500 region. Gold is approaching the $3,450 zone, and a break above $3,500 could take spot gold to new highs.

Silver Technical Analysis

XAGUSD Daily Chart – Bullish Price Action

The daily chart for spot silver (XAGUSD) shows that the price has rebounded from the 50-day SMA at $36, indicating strong bullish momentum. A break above $39.50 would signal a move toward the $43 area. The emergence of an Adam and Eve pattern, along with positive price consolidation and a breakout above $35, suggests that silver is likely to move higher.

XAGUSD 4-Hour Chart – Bullish Price Action

The 4-hour chart for spot silver shows a positive bullish price action above the $31.80 area. Long-term support remains between $34.50 and $35, and the price is building a bullish structure. A break above $39.50 would signal a move toward the next resistance at $43.

US Dollar Index Technical Analysis

US Dollar Daily – Negative Price Action

The daily chart for the US Dollar Index shows that it failed to break above 100.50 and continues to consolidate around the 98.80 area. This consolidation, following the drop after the employment report, indicates that the price action remains negative for the index. A break below the 96 level would trigger strong bearish pressure and push the US Dollar Index to lower levels.

US Dollar 4-Hour Chart – Negative Price Action

The 4-hour chart for the US Dollar Index shows negative price action after failing to break above 100.50. A break below the 96 level is needed to push the index to lower levels. However, a break above 100.50 would likely drive the US Dollar Index toward the 102 level.