Gold (XAUUSD) & Silver Price Forecast: Metals Rise as 80% Rate Cut Odds Reshape Market Outlook

Market Overview

Gold and silver advanced in early European trading on Tuesday as investors grew more confident that the Federal Reserve is preparing to loosen monetary policy at its December meeting. The move follows a series of softer labor-market readings and remarks from senior Fed officials suggesting that economic conditions no longer justify restrictive rates.

Fed Governor Christopher Waller said last week that hiring indicators point to a “material cooling” in employment, whileSan Francisco Fed President Mary Daly described labor trends as “increasingly fragile.” Their comments strengthened the case for a quarter-point cut, a view that has quickly reshaped market expectations.

According to the CME FedWatch Tool, traders now assign nearly an 80% probability to a rate cut in December, up sharply from 30% earlier this month. That shift has supported precious metals, which typically benefit when real yields decline and the dollar softens.

Labor Softness Reinforces Demand for Safe-Haven Assets

Recent macroeconomic releases have reinforced the trend. Job openings have dropped to their lowest point since early 2021, while multiple payroll indicators show hiring momentum slowing more rapidly than policymakers anticipated. Economists argue that weaker labor conditions leave the Fed with less justification to maintain its higher-for-longer stance.

The combination of slowing employment, moderating inflation, and subdued wage growth has encouraged investors to rotate toward safe-haven assets. Gold and silver, which often serve as hedges during periods of shifting monetary policy, have seen renewed inflows as traders position for potential easing.

Analysts note that the environment resembles prior pre-cut cycles where precious metals outperformed in the weeks leading up to the policy shift. “Markets have moved past the debate of whether cuts are coming and are now focused on timing,” said Bart Melek of TD Securities.

Investors Await Pivotal U.S. Data

Markets now turn to a string of U.S. releases expected later in the day. Consensus estimates project a 0.3% month-over-month increase in the Producer Price Index and a 0.4% rise in Retail Sales. The ADP employment report is also expected to provide additional clarity on private-sector hiring trends.

Stronger-than-expected readings could briefly bolster the dollar and temper precious-metal gains, while softer data would likely reinforce expectations for December easing—keeping gold and silver firmly supported.

Short-Term Forecast

Gold may retest $4,179 with support near $4,110, while silver targets $52.41 and could ease back toward $51.00 if momentum cools ahead of key U.S. data.

Gold Prices Forecast: Technical Analysis

Gold is pushing toward the $4,179 resistance after breaking above the 20-EMA and reclaiming momentum from the mid-range zone. Price is still moving inside a broad symmetrical structure, with the upper trendline capping rallies and the rising lower trendline supporting pullbacks.

The recent climb from $4,060 shows steady demand, helped by a higher-low formation on the 2-hour chart. The RSI is holding near 70, showing strong momentum but not yet signaling a clear reversal signal.

If gold closes above $4,179, the next area to watch is $4,245, where the previous rejection occurred. Failure to break resistance could pull price back toward the $4,110–$4,083 support band.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver is trading just above $51.00, gaining traction after breaking out of a descending trendline that contained price for most of the month. The move above the 20-EMA shows improving short-term momentum, while the 200-EMA sits lower and continues to support the broader structure.

Price is now testing the $52.41 resistance zone, a level that previously rejected buyers and remains a key hurdle. The RSI is holding near the upper range, showing firm momentum but not yet signaling exhaustion.

If silver closes above $52.41, the next upside target sits at $53.31. Failure to clear resistance could send price back toward the $50.98–$50.00 support band.