Gold and Silver Technical Analysis: Safe-Haven Rally Fueled by US Dollar Weakness

Gold (XAU) and silver (XAG) prices surged as the US dollar weakened amid escalating trade tensions and rising geopolitical risks. Gold has pushed above $3,350, while silver remains bullish above $32.50. The bearish pressure on the US dollar makes both metals attractive to global buyers, adding to their upward momentum.

The market awaits key US data, including Flash PMIs, Durable Goods Orders, and Consumer Sentiment. These reports could shape Fed policy expectations and influence the dollar’s direction and yields. If the data reveals economic weakness or persistent inflation, gold and silver may continue to rally. However, strong data and rising yields could temporarily pause their upward momentum.

Fed Chair Powell’s warning that tariffs could raise inflation and slow growth added pressure on markets. Furthermore, his statement that no “Fed put” would be removed hopes for policy support during a collapse. As a result, this triggered fears of stagflation, limiting the Fed’s ability to fight inflation and recession. Meanwhile, the Chicago Fed Index rose to -0.42, signaling tighter financial conditions. Consequently, as confidence in the dollar weakened, gold surged to a new high of $3,385 per ounce. This rally reflects strong safe-haven demand.

Gold (XAU) Technical Analysis

Gold Daily Chart – Break of $3,350

The daily chart for gold shows that the price has broken the resistance at $3,350 and continues to move upward. The price maintains positive momentum and indicates a move to the $3,500 zone.

Gold 4-Hour Chart – Ascending Channel

The 4-hour chart shows that the price has broken the ascending channel and reached the extended channel near $3,400. The price remains extremely overbought, but the ongoing momentum is strongly bullish. A correction from this level would present a buying opportunity.

Silver (XAG) Technical Analysis

Silver Daily Chart – Resistance of 50-Day SMA

The daily chart for silver shows that the price has broken above the 50-day SMA and remains bullish. As the price closes above the 50-day SMA, the RSI has also closed above the mid-level, indicating positive price action. This strength suggests a potential move toward the $35 level.

Silver 4-Hour Chart – Positive Development

Meanwhile, the 4-hour chart for silver shows that the rebound from $28 has reached the resistance at $32.50. Currently, the price is consolidating around this level and shows positive momentum. If it breaks above $33, it would likely extend the bullish move toward $35.

US Dollar (DXY) Technical Analysis

US Dollar Daily – Bearish Pressure

Moreover, the daily chart for the US Dollar Index shows it remains under extreme bearish pressure. In fact, consolidation below 100.65 increases the likelihood of a sharp drop toward the 96–97 region. Additionally, the RSI remains at oversold levels, indicating continued bearish momentum.

US Dollar 4-Hour Chart – Descending Channel

The 4-hour chart for the US Dollar Index shows that it remains within a descending channel and under strong bearish pressure. Consolidation near the lower edge of the channel increases the likelihood of a further drop below this range. The index is targeting a move toward the 96–97 region.