Gold (XAUUSD) & Silver Price Forecast: XAU Hits $4,606 Resistance – Breakout or Fakeout?

Gold And Silver Bounce Back Tuesday – But Will It Last?

Gold and silver prices ticked up on Tuesday but it wasn’t enough to wipe out the losses they took in March. That’s a bit of a relief because the energy markets seem to have finally stabilised after weeks of chaos caused by the turmoil in the Middle East.

This means the metals have had a bit of a breather – although its worth noting they’ve still had a rough ride since hitting record highs earlier in the year. At that point oil went through the roof and people started getting a bit nervous about inflation, which made the US dollar stronger and took away some of the appeal of gold as a safe-haven investment.

It all started when Brent crude prices jumped, and that briefly pushed gas prices past $4 a gallon. As a result, people thought the Federal Reserve might not end up cutting interest rates after all. And when rates go up, it tends to make things a bit harder for people who invest in non-interest-paying assets like gold.

Said one London-based metals strategist: “The market is just adjusting its expectations basically” “The situation with geopolitical risk isnt looking any less hairy, but the dollar and interest rates are taking over”

The behaviour of silver particularly has been pretty wild, and it actually dropped by a record amount in March. The gold to silver ratio has since narrowed right down to the low sixties – which tells you that silver is doing a bit better and that investors are starting to think twice about future growth and the chances of supply chain problems.

Analysts think it will be a pretty quiet few weeks for trading as markets wait to see how oil turns out, what the latest inflation figures are and what the central banks have to say for themselves.

Gold Price Outlook: XAUUSD taking a closer look at that $4,606 Breakout Zone

Gold (XAUUSD) is hovering around $4,576 on the 2 hour chart – after bouncing back from that low of $4,099 and now stuck beneath that critical resistance level at $4,606. Price action is curving in on itself, supported by an upward trendline while held in check by that resistance line which is essentially a continuation of where the price used to go.

If gold can just manage a sustained move above $4,606, we might start to see a clearer path up towards $4,725 and even beyond to $4,856. On the downside, support is pretty immediate at $4,484, then $4,354.

The momentum isn’t bad but it’s also not getting any stronger – the RSI is around 60 and that’s not bad, but its still below that 200-period average, which keeps us wary of the bigger trend.

Silver Price Forecast: XAGUSD wondering if they can break past that $74 Zone

Silver (XAGUSD) is right around $73.20 on the 2 hour chart – it has been slowly recovering from that sharp drop that bottomed out at $61.08. The price is now respecting that upward trendline from the recent low and it’s making higher lows while bumping up against that resistance level around $74.56.

We just recently saw the $71.53 area go from being a supply zone to being a near-term support and guess what – it’s also pretty close to that 50-period moving average. However, the price is still below the 200-period average at $77.79, so we’re still being a bit cautious.

If silver can just make a sustained break above that $74.56, we might see a clearer path up towards $77.80. But if they can’t hold above $71.53, we’ve got to worry about a pullback to $67.50.