Gold (XAUUSD) & Silver Price Forecast: Fiscal Gridlock and Fed Outlook Boost Investor Caution

Market Overview

Gold and silver continued their upward momentum in Asian trading as investors shifted toward safe-haven assets amid renewed global uncertainty. The rally comes as the United States faces its third week of a government shutdown, renewed trade frictions with China, and mounting expectations of interest-rate cuts from the Federal Reserve. These overlapping risks have created a climate where investors seek stability in tangible stores of value.

The ongoing fiscal standoff in Washington is eroding investor confidence in near-term economic stability.

“The shutdown amplifies the perception of fiscal vulnerability at a time when broader macroeconomic pressures are already high,” said one commodities strategist based in Singapore. With the Senate yet to approve a funding plan, traders continue to hedge against prolonged policy gridlock that could weigh on U.S. growth.

Trade Strains and Monetary Policy Fuel Precious Metals

Trade tensions between the U.S. and China also underpin the move into metals. Despite softer rhetoric following tariff threats, investors remain wary of potential disruptions to global supply chains and manufacturing.

This renewed uncertainty has driven capital inflows toward gold, historically seen as a hedge against geopolitical and economic shocks.

At the same time, market data show traders are fully pricing in a 25-basis-point rate cut in October, with a 90% probability of another reduction in December. Lower interest rates tend to weaken the dollar and enhance the appeal of non-yielding assets like gold and silver.

Dollar Resilience Fails to Dampen Momentum

Interestingly, the dollar’s resilience has done little to stem the advance. The U.S. Dollar Index remains near a two-month high, yet gold prices have continued to climb, reflecting the strength of safe-haven flows.

Looking ahead, attention turns to upcoming remarks from Federal Reserve Chair Jerome Powell, which could offer clues on the trajectory of monetary policy.

For now, with fiscal tension, trade uncertainty, and easing expectations shaping sentiment, gold and silver appear well-positioned to maintain their upward trajectory in the near term.

Short-Term Forecast

Gold is expected to trade between $4,060 and $4,220, with support from easing bets and safe-haven demand. Silver may consolidate above $51.00, eyeing resistance near $53.40–$55.50 in the near term.

Gold Prices Forecast: Technical Analysis

Gold (XAU/USD) is trading around $4,108, pulling back slightly after reaching a session high near $4,180. The metal remains in an overall uptrend, supported by the 50-day EMA at $4,040 and the 200-day EMA at $3,895. Fibonacci retracement levels highlight immediate support at $4,090 (38.2%) and $4,062 (50%), where buyers may look to re-enter.

The RSI near 59 suggests cooling momentum after overbought conditions, implying potential short-term consolidation before another push higher.

If gold holds above $4,060, a rebound toward $4,180 and possibly $4,220 could follow. A break below $4,040, however, may expose a deeper correction toward $3,995.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver (XAG/USD) is trading near $51.49, retreating from resistance around $53.44 after a strong rally within an ascending channel. The 50-day EMA at $49.36 continues to offer dynamic support, while the 200-day EMA at $45.01 reinforces the broader uptrend.

Immediate support lies at $50.99, and a break below could push prices toward $49.73. The RSI near 57 shows easing momentum, suggesting short-term consolidation before another potential leg higher.

If buyers defend the channel’s midline, silver could rebound toward $53.40, with a breakout above that level targeting $54.44–$55.57. A close below $49.70, however, would indicate a deeper pullback toward $48.50.