Gold (XAUUSD) and Silver Technical Analysis: Triangle Breakdown and Correction Setups

Gold (XAUUSD) continues to drop from the $3,450 resistance and has fallen to a one-month low. The price dipped below $3,270 on Wednesday, pressured by stronger US economic data and the Fed’s decision to keep rates unchanged. However, buyers returned as safe-haven demand resurfaced, lifting the price back above $3,300. Despite the rebound, uncertainty remains, and the market now awaits key economic data on Friday. The release of the Non-Farm Payrolls (NFP) report will likely determine the next move in gold prices.

The Core PCE Price Index rose by 0.3% in June 2025 compared to the previous month, marking the most significant increase in four months and aligning with market expectations. A 0.3% rise in the Core PCE signals persistent inflation pressure. Since this increase was expected, it does not significantly shift Fed policy in the short term.

Trade tensions also boosted gold’s recovery. Investors grew cautious ahead of the August 1 tariff deadline. President Trump is set to impose aggressive tariffs on countries without finalised deals. These actions revived demand for gold as a hedge against geopolitical and economic uncertainty. Moreover, the Fed’s pause in rate hikes kept real yields under pressure.

On the other hand, the institutional demand continues to grow. The World Gold Council reported strong inflows into gold ETFs in the first half of 2025. Central banks also added gold to reserves, reaffirming their role as a strategic asset. With inflation risks persisting and global trade friction rising, gold remains well-supported in the medium term.

Gold Technical Analysis

XAUUSD Daily Chart – Breakout from Ascending Triangle

The daily chart for spot gold shows that the price has broken below the ascending triangle and is now moving toward the 100-day SMA. The price appears weak following the breakout, suggesting that the 100-day SMA may also be broken to the downside.

Gold may continue to decline further in search of support. However, the broader-term outlook remains strongly bullish, and the price is likely to find a bottom near the key support level, potentially setting the stage for the next upward move by the end of 2025. The levels of $3,150 and $3,000 remain the key support areas.

XAUUSD 4-Hour Chart – Consolidation

The 4-hour chart for spot gold shows that the price is consolidating within the orange zone. A breakout below the $3,230 level would likely trigger further downside toward the $3,050 area. Failure to break above the $3,450 resistance weakens the bullish outlook and suggests continued downside pressure on spot gold prices.

Silver Technical Analysis

XAGUSD Daily Chart – Correction from Overbought Region

The daily chart for spot silver (XAGUSD) shows that the price has encountered resistance at $39.50 and has started a sharp decline toward the 50-day SMA around the $36 area. A break below the $36 level could push prices toward strong support in the $35 region. Silver is likely to find support between $34 and $35, potentially setting the stage for the next move higher toward the $40–$42 area.

XAGUSD 4-Hour Chart – Correction

The 4-hour chart for spot silver shows that the price is approaching the orange zone support in the $34 to $35 region. The overall price action remains strongly bullish, and this correction is likely to find support for the next upward move. In the short term, the price appears oversold and is showing signs of a potential rebound.

US Dollar Index Technical Analysis

US Dollar Daily – Bullish Reversal Pattern

The daily chart for the US Dollar Index shows that the index has broken above the 50-day SMA and initiated a strong upward move. Immediate resistance is seen at the 100.50 level. A breakout above 100.50 could drive the index higher toward the 102 level.

US Dollar 4-Hour Chart – Inverted Head and Shoulders

The 4-hour chart for the US Dollar Index shows that the price has formed a bottom in the form of an inverted head and shoulders pattern and has initiated a strong upward move. Immediate resistance lies at the 100.50 level. A breakout above 100.50 could propel the index toward the 102 level. Such a breakout would also likely increase bearish pressure on spot gold prices.