Gold (XAUUSD) & Silver Price Forecast: Central Bank Buying Supports Gold at $4,175 After NFP — Silver Holds $60.05?

Precious Metals Fundamentals Supported by Central Bank Demand and Supply Limits

As of July 3, the markets for gold and silver continue to be buoyed by central-bank accumulation, which has not shown any sign of waning. Gold and silver central-bank demand have been supported by a growing need for diversification given the current high level of global indebtedness and changing monetary policies in many economies. The gold and silver central-bank demand have provided a persistent support for metal markets.

Metal primary supply of gold and silver continues to run on the lighter side, with gold supply rising only slightly over recent years due to more mature ore deposits and increasing costs to build new mines and silver supply has been similarly constrained, bolstered by silver from byproduct mines. Recycled metal continues to respond quickly.

Demand for silver fabricating for solar energy generation, electronic components, and electric vehicles has been on par with solar and other industries growth. Demand for gold and silver from investors remains consistent as exchange traded products continue to increase.

At this point, the fundamentals for gold and silver remain strong with the metals driven by central bank buying supported by various macro economic drivers, such as inflationary expectations and fiscal policy.

Gold Spot Rises to $4,175 – Downward Trendline Breakout on 2h

 

Price of Gold Spot at 4175 is currently at $4,175 on the 2-hour chart. Green candles are continuing up breaking out of the downward trendline near $4091 after having protected triple bottoms near $3959. The pattern includes Bullish Engulfing patterns and higher highs that confirm the reversal and the RSI is above 71. This also shows bullishness with the Volume profile indicating that the area of accumulation at $4000 to $4091 is quite large.

The blue 50 EMA at $4074 has now also supported this area. Gold Spot Price has a bullish structure above $4091 even if it trades in a broad down channel. Fibonacci confluence adds additional support to the bullish bias for the short term as the market continues to produce a higher low structure.

Trading Strategy: Buy at $4,175 with the target at $4,201 and the stop loss at $4,091.

Silver Spot Rises to $60.05 – EMA 50 Defense on 2h

Price of Silver Spot at 60.05 is currently at $60.05 on the 2-hour chart. Green candles continue up protecting the 50 EMA at 60.05 from a drop from the High of $69.85. Green candles form a pattern of bullish wicks that protect a series of higher lows from the Low of $57.12 to demonstrate buyers are absorbing the price at this level.

RSI is also near 70 indicating bullish conditions. The Volume profile shows an emerging fair value cluster of $58-$60. The next resistance area is at $61.33-$62.43. Silver Spot Price structure is neutral and bullish above the 50 EMA even though it trades in a broad down trend. The higher lows continue to make the price attractive to buyers on dips.

Trading Strategy: Buy at $60.05 with the target at $61.33 and the stop loss at $59.00.x