Gold and Silver Correct as Tariff Uncertainty Triggers Profit-Taking

Gold (XAU) corrected to the $3,100 area after hitting the resistance of $3150, as traders took profits ahead of April 2’s expected tariff announcement by President Trump. The uncertainty over potential universal tariffs, rumored to reach 20%, paused the recent bullish run in gold. Despite the dip, the market sees strong underlying support due to weakening U.S. data and falling yields favoring safe-haven assets.

Silver (XAG) followed gold’s lead, correcting lower from the $35 resistance as sentiment turned cautious. The ISM Manufacturing PMI dropped from 50.3 to 49.3, as shown in the chart below. This drop in ISM manufacturing indicates sector contraction.

On the other hand, job openings fell below expectations at 7.568 million. These signals of slowing economic momentum support silver’s medium-term bullish structure. However, the short-term pause reflects investor hesitation ahead of key data like Nonfarm Payrolls and Powell’s speech. Moreover, recession risks are increasing, pushing gold to record levels, but the price is overextended in the short-term.

Gold (XAU) Technical Analysis

Gold Daily Chart – Bearish Hammer

The daily chart for gold shows that the price has formed a bearish hammer at the resistance area. This pattern suggests a possible correction. However, the bullish momentum from early 2025 remains strong, indicating that the correction might be short-lived. This pullback could provide further guidance for the next strong rally in the gold market.

Gold 4-Hour Chart – Short-Term Target

The 4-hour chart for gold shows that the price has hit the short-term target at $3,150 and is now correcting lower. The price appears overextended in the short term. Based on the broader bullish outlook for gold, this short-term correction provides a buying opportunity for investors. A break above $3,150 will indicate further upside before any meaningful correction.

Silver (XAG) Technical Analysis

Silver Daily Chart – Resistance

The daily chart for silver shows that the price has hit the resistance area at $35 and is correcting lower. This pullback remains within the bullish price structure. Despite gold’s strong rally, silver failed to break out from its respective resistance at $35. However, based on the bullish structure, a break above $35 would guide the $43 and $50 levels.

Silver 4-Hour Chart – Ascending Broadening Wedge

The 4-hour chart for silver shows that the price is moving within an ascending channel, and the current correction remains within the boundaries of the red-dotted trend lines. The price also stays above the black dotted trend line, with strong support around the $32.50 level.

US Dollar (DXY) Technical Analysis

US Dollar Daily – Bearish Pressure

The daily chart for the US Dollar Index shows that the index continues to consolidate above 103.50 and remains bearish. The rebound from 103.50 does not change the negative outlook. A break below 103.50 would likely push the index toward 100.65, while a break above 105.20 would suggest further upside potential.

US Dollar 4-Hour Chart – Double Bottom

The 4-hour chart for the US Dollar Index shows that the index is forming a double bottom pattern at the 103.50 support level. However, the index needs to reclaim the 105.20 area for further confirmation. A break below 103.50 would negate the bullish setup and signal further downside.