Gold (XAUUSD) & Silver Price Forecast: Fed Caution, Geopolitics Limit Precious Metal Losses

Market Overview

Gold prices declined during Friday’s Asian session, slipping below $3,355 per ounce amid a stronger US dollar and risk-on sentiment fueled by trade optimism. The yellow metal posted modest losses as robust US economic data and progress in trade discussions between the US and Japan lifted the greenback and reduced investor appetite for safe-haven assets.

Silver also edged lower, with XAG/USD trading near $39.05.  The move mirrors broader weakness in precious metals, which is being pressured by renewed strength in the dollar and a rebound in global risk appetite.

US Labor and Services Data Reinforce Growth Narrative

A string of upbeat US macroeconomic indicators this week has strengthened expectations for a resilient economy. Initial jobless claims fell to 217,000—the sixth consecutive weekly decline and the lowest figure since April—signaling continued labor market stability.

Meanwhile, the S&P Global Composite PMI climbed to 54.6 in July, sustaining over two years of expansion. The Services PMI jumped to 55.2, its highest reading of the year, reflecting firm demand in the consumer economy. The data collectively boosted the US dollar, which had recently been trading near multi-week lows.

“The services sector is proving to be a backbone of US growth,” noted one market strategist. “This momentum in non-manufacturing activity is offsetting global concerns and giving the Fed room to remain cautious.”

Fed Uncertainty and Geopolitical Risks Offer Limited Support

Despite bearish pressure, Gold remained supported by lingering uncertainty surrounding the Federal Reserve’s next rate move. While some officials, including Fed Governor Christopher Waller and Vice Chair Michelle Bowman, have signaled openness to a rate cut, recent data complicates the decision ahead of the July 30 meeting.

Additionally, geopolitical unease in Southeast Asia, particularly tensions around regional borders, has helped limit losses in the precious metals market. These broader concerns may continue to offer intermittent support to both Gold and Silver as markets weigh risk against recovery.

Short-Term Forecast

Gold remains under pressure below $3,360 as dollar strength and risk-on sentiment persist, though Fed uncertainty and geopolitical tensions may limit further downside in the near term.

Gold Prices Forecast: Technical Analysis

Gold (XAU/USD) is trading near $3,354, having slipped below its 100 EMA at $3,358 on the 4-hour chart. The price is testing a key ascending trendline support near $3,331. A sustained move below this level could expose gold to further downside toward $3,310 and $3,283.

The 50 EMA at $3,370 is now immediate resistance. With momentum weakening and recent highs near $3,433 rejected, the bias is shifting bearish unless buyers can reclaim $3,372.

If support holds, a rebound to retest $3,402 and $3,433 remains possible. However, broader sentiment remains cautious ahead of upcoming U.S. economic data.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver (XAG/USD) remains within a rising parallel channel on the 4-hour chart, currently trading near $39.05. The price recently rebounded from the lower trendline and is holding above the 50 EMA at $38.58.

A sustained move above $39.13 could open the door for a retest of the $39.47 and $39.78 resistance levels. However, failure to hold the lower channel support may drag silver toward $38.72 and $38.44.

The technical structure remains bullish for now, with buyers defending key support levels; however, a break below $38.72 would weaken momentum and shift the near-term bias.