Gold (XAUUSD) & Silver Price Forecast: $5,250 Rejected – Will Bulls Regain Control?

Market Overview

Gold (XAU/USD) didn’t get off to a great start and dropped below the $5,250 mark after hitting a brand new high overnight, but to be honest its no real surprise considering the US dollar is once again gaining some serious momentum.

This is all thanks to the US Federal Reserve’s hawkish stance, which is basically saying they’re not going to be cutting rates anytime soon.

Gold (XAU/USD) Getting Crushed by Hawkish Fed but Rate Cuts and Trade Wars Are Keeping Prices Afloat

Jan FOMC’s meeting minutes showed the Fed are becoming increasingly cautious about the possibility of cutting rates and now suggest that rate cuts will only happen if US inflation really starts to pick up again. In reality this means the US dollar is likely to stay strong which in turn has put a lot of pressure on Gold prices.

And then there’s the Fed Governor Christopher Waller who had suggested that the Fed could even leave rates alone in March if the labour data turns out to be stable – so you can see how the Fed’s hawkish attitude is all having a big impact on Gold.

But when you look at the market expectations things still look a bit mixed – the CME Groups FedWatch Tool is still showing that traders are pricing in 3 rate cuts this year which could well keep a lid on any further losses in Gold.

But to add another bit of uncertainty to the mix, the whole US tariffs thing is still causing a lot of concern in the markets and this could be the thing that limits further gains in the US dollar and prevents deeper losses in Gold.

Geopolitical Tensions Keeping Gold Prices Stable

Meanwhile, geopolitical tensions are still playing a major role in keeping Gold prices pretty stable – I’m talking about worries about a possible war in the Middle East which are keeping safe-haven demand pretty high.

Traders are pretty cautious at the moment and aren’t ready to call a full trend reversal just yet.

Looking ahead, everyone is gonna be keeping a very close eye on the US macro data and speeches from Fed officials this week – so lets see how Gold gets on in the coming days.

Gold Forecast: XAU/USD Tests $5,200 as Geopolitical Risk Premium Lifts Prices

Gold is trading right now at $5,182 after spelling a very brief moment at $5,250, all thanks to the ongoing tensions that are fueling the safe-haven demand for gold. On the daily chart, the price is thankfully still sitting pretty above the 0.50 Fibonacci line at $5,000 and is also nudging up against the 0.618 retracement at $5,141, which is a good sign that the overall uptrend is still firmly intact.

That rising trendline, which starts back at $4,400, is still doing its job of guiding price higher on lows, while the 50-day moving average at $4,685 is definitely a source of structural support.

Recent candlesticks have been telling a story of price rejection near $5,300 – a sort of ‘wall of resistance’ of supply overhead. When price can punch above $5,250 for real, though, then watch out for a potential test of $5,448. But for now, if the price falls below $5,000, it could definitely see near-term momentum take a hit.

Silver Forecast: XAG/USD Reclaims $88 as Buyers Challenge $92 Barrier

Silver is currently trading around $88.90 on the 4 hour chart, having rebounded nicely off the $71.08 low-point. With price now comfortably above the 0.382 fib level at $86.13 , the short term outlook has shifted firmly back in favour of the buyers.

The 50 period moving average, hovering near $85.50, is now actually starting to trend upwards – while the 200 period average at $86.10 is providing a supporting layer to underpin the market.

However, the $92.96 level at the 0.5 retracement still represents a major hurdle, with $99.69 at the 0.618 level being the next level of resistance beyond that. A break above $92 would give the bulls the momentum to push on towards $100.