Gold (XAUUSD) & Silver Price Forecast: Fed Bets and Trade Truce Weigh on Demand

Market Overview

Gold (XAU/USD) slipped to $3,206 in early Friday trading, unable to recover from recent declines triggered by a shift in global market sentiment. The announcement of a 90-day trade truce between the U.S. and China has significantly reduced short-term trade friction, removing a key driver of safe-haven demand.

In response, investors have rotated toward risk assets, leaving gold under modest pressure. Silver (XAG/USD) followed suit, trading near $32.46, also weighed by waning risk aversion. However, silver’s industrial use and broader demand outlook continue to provide a degree of price support.

Mixed Global Signals Keep Market Direction Uncertain

While reduced trade friction has softened gold’s appeal, broader geopolitical developments remain unresolved. Ongoing military activity in the Middle East and stalled negotiations elsewhere have sustained a moderate geopolitical premium.

Reports of renewed peace talks between Russia and Ukraine brought some relief, but market participants remain cautious given the absence of definitive outcomes.

The market is currently grappling with competing signals—improved trade dialogue on one hand and unresolved conflicts on the other—keeping directional conviction in gold limited. Analysts note the metal remains sensitive to macro-level shifts in sentiment rather than sharp, directional moves.

Soft U.S. Economic Data Limits Downside for Precious Metals

Recent U.S. economic indicators have supported expectations of monetary easing. April’s Producer Price Index declined by 0.5%, its first monthly drop in over a year, while retail sales slowed significantly to 0.1%.

These developments, along with earlier soft CPI data, have increased the probability of a Federal Reserve rate cut later this year.

As a result, U.S. Treasury yields declined, weakening the dollar and helping to stabilize gold prices.

Short-Term Forecast

Gold remains capped below key resistance at $3,252, with bearish momentum building. A break below $3,208 could expose $3,162, while silver eyes $32.12 if $32.40 fails.

Gold Prices Forecast: Technical Analysis

Gold (XAU/USD) is trading near $3,214 after rejecting the $3,252 level and its 50 EMA at $3,229. Price is now caught below a well-defined descending trendline that’s guided lower highs since early May. The recent failure to break above the EMA, followed by a bearish engulfing candle, suggests sellers are reasserting control.

The $3,208 level—previously acting as support—is being retested and holds the key to whether gold stays afloat or slips further. If this level breaks, the next supports to watch are $3,162 and $3,119.

On the upside, bulls need a clean close above $3,252 and the trendline to shift the short-term bias. Until then, the path of least resistance remains to the downside.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver (XAG/USD) is trading around $32.46 after failing to hold above the $32.70 resistance, which also coincides with a downward trendline stretching from early May. The rejection near the 50 EMA at $32.48 reinforces the idea that bearish momentum is still in control for now.

Candlestick structure shows long upper wicks around resistance zones, pointing to seller aggression. The price is hovering just above support at $32.40, but a break below that could expose the next levels at $32.12 and $31.88.

For bulls to regain control, silver must decisively break above the descending trendline and $32.70 resistance. Until that happens, short-term sentiment leans bearish, especially with lower highs still defining the broader structure.