Gold (XAUUSD) & Silver Price Forecast: Ceasefire Hopes vs. Fed Hawks – Gold at Risk?

Market Overview

Gold (XAU/USD) is currently trading just below $4,570, having seen a high-water mark of $4,602 as the market copes with the unpredictable mix of geopolitical hotspots and expectations that monetary policy might be about to shift.

Key Market Drivers

Safe-Haven Appeal Holds: Yep, gold still feels pretty solid even after its recent dip from an eye-watering $5,400 high. All this ongoing US-Israel-Iran stuff has a lot of people feeling that gold is due another leg up – there’ve been plenty of strikes in Lebanon, Iraq and the Gulf area.

Ceasefire Hopes: Then the news broke about the US offering up a 15 point truce plan via some Pakistani middlemen. And, of course, Trump deciding to hold off on hitting Iranian oil fields had everyone feeling a bit better, at least temporarily. Still, you get the feeling that Iran’s military aren’t buying all this.

Dollar and Fed Create Headwinds: There’s the dollar, which is pretty hot right now, and Federal Reserve traders are starting to think they might end up raising rates after all. Meanwhile oil is hovering around that scary $100 a barrel mark, which helps keep inflation worries alive. So you get the picture – for all that gold’s still being bid, it’s running out of steam a bit.

Gold Prices Forecast: XAU/USD Holds $4,544 as Fibonacci Rebound Tests Sellers

Gold is tickling $4,558 on the 2 hour chart, hanging around $4,544 which is just below the 0.382 Fibonacci level (just in case you needed a reminder) after bouncing back from the $4,378 zone which is roughly where the 0.236 retracement happens. Its sitting just beneath the 50-period moving average and the descending channel resistance, so short term the structure is looking a bit iffy. We’ve also got the 0.5 Fibonacci level at $4,677 and 0.618 at $4,811 looming as major hurdles, while $4,378 and $4,111 have deeper water written all over them in terms of support.

Looking at the recent candles we can see that we got a nice run of higher lows from $4,300 and momentum is at least slowly starting to pick up but is still struggling against the resistance. RSI’s trying to claw its way through to 60, reflecting a gentle pick up in momentum without much sign of things getting overbought.

A break above $4,677 would probably take us on a little dance towards $4,811, while a rejection below $4,544 might just push us back down to $4,378.

Trade idea: Buy above $4,677 heading for $4,811, set stop below $4,544.

Silver (XAG/USD) Price Forecast: Faces $74 Supply Under Descending Trendline

Silver is knocking on $72.65 on the 2 hour chart, coming up against the $74.19 resistance zone where it used to be supported but is now looking like it might make a bid to become supply. Still below that nasty descending trendline, and stuck under the 200-period moving average which is parked at $77.61 showing broader bearish sentiment. Our 50-period moving average is at $72.90 right now and acting as immediate dynamic resistance.

Lower down we’ve got $68.15 and $64.26 looking like they might be the new support levels – at least for now. A break above $74.19 might just push us on up to $77.61. The candlestick structure is showing us quite a bit of hesitation around resistance – we’ve had some pretty quiet bodies forming after a sharp rebound from $61.08. RSI is trying to get above 60 which probably suggests the momentum is getting a bit stronger but we’re not quite there yet.

A decisive move above $74.19 would start to chip away at this downtrend a bit, while a rejection might just see us pulled back down to $68.15.

Trade idea: Sell below $74.19 heading for $68.15, set stop above $75.00.