Gold, Silver, EUR/USD Technical Analysis with Key Levels to Watch Amid US Election

Gold (XAU) price is consolidating at record levels and showing positive momentum. Meanwhile, silver (XAG) has broken the $32.50 level and is consolidating after the breakout. US durable goods orders fell by 0.8% in September, while US consumer sentiment exceeded expectations in October, rising to 70.5 compared to the forecast of 69.2. These data releases contributed to the positive momentum in gold, which closed higher for the week.

Gold and silver prices are supported by safe-haven demand amid heightened geopolitical risks. These risks have created an environment of uncertainty as the US election approaches on November 5th. According to the latest news, Donald Trump is edging forward in many polls, suggesting an increased chance of his victory. A Trump win could further boost safe-haven flows due to post-election uncertainty.

On the other hand, the US dollar continues to strengthen and shows no signs of price correction. Last week’s price correction was quickly reversed, initiating another decline in EUR/USD. The outcome of the US election will be crucial in determining the next move for the pair. This week, the CB Consumer Confidence and JOLTS Job Openings data on Tuesday will influence the gold, silver, and EUR/USD markets. Additionally, the ADP Nonfarm Employment Change and Advance GDP data on Wednesday are also significant. The biggest event of the week is the Nonfarm Payrolls report on Friday, which is expected to set a decisive direction for the markets.

Gold (XAU) Technical Analysis

Gold Daily Chart – Bullish Momentum to Continue

Gold shows strong price momentum on the daily chart despite a correction from the red-dotted trendline. Last Friday’s close was strong, highlighting the underlying price strength. The breakout from the descending broadening wedge pattern, followed by positive price action at the key resistance line, suggests that another breakout may be imminent. The ongoing strength in the gold market indicates that the price may be entering a parabolic move, with the target remaining within the ascending broadening wedge pattern. The long-term target for this strong move is $3,000, and the price appears to be heading toward that region.

Gold 4-Hour Chart – Double Bottom

The 4-hour chart also shows bullish, solid momentum in the gold market. The price correction on the 4-hour chart has brought prices toward the mid-level of the RSI, from which gold rebounded last week. The formation of a double-bottom pattern following this rebound indicates price strength and bullish momentum. Currently, the price is trading within a 3-month ascending channel and is targeting the $2,780 level on the 4-hour chart. This target is measured from the resistance line of the ascending channel.

Silver Technical Analysis

Silver Daily Chart – Descending Broadening Wedge

The price has broken the key $32.50 level on the daily chart. It reached the overbought region and corrected lower from the $35 resistance. This resistance was missed by just a few cents before pulling back due to the overbought condition. This correction from the $35 resistance is pushing the price back toward the $32.50 breakout level. A retest of this price region is likely to prompt a strong rebound and drive silver to another higher level. A weekly close above $35 could propel silver toward the next resistance at $43.

Silver 4-Hour Chart –Inverted Head and Shoulders

The 4-hour chart for silver also shows positive price action, highlighted by an inverted head-and-shoulders pattern that broke through the key $32.50 level. This inverted head-and-shoulders formation, along with a historical double-bottom on the 4-hour chart, indicates a positive trend and potential for higher prices. The current price correction back to the $32.50 level is due to an overbought condition, where new buyers are likely to push prices higher again.

EUR/USD Technical Analysis

EUR/USD Daily Chart – Price Pressure at Ascending Broadening Wedge

The pair is showing negative price action at the strong support region of $1.0770 to $1.0790. While the price rebounded higher on Thursday from this support, it reversed lower on Friday. The ascending broadening wedge pattern and the black dotted trendline on the daily chart define this support area. Given the strength of this support region, the price may consolidate further or initiate another rebound. However, a weekly close below $1.0770 could break this support region and trigger further downward movement. Strength in the US Dollar Index, due to uncertainty from the US election, is contributing to price volatility. Overall, the trend remains bearish as the price trades below the 50 and 200 SMAs.

EUR/USD 4-Hour Chart – Consolidation at Support

The 4-hour chart shows bearish pressure. However, the rebound from strong support failed, resulting in a negative weekly close. The pair may still experience volatility due to ongoing uncertainty surrounding the US election outcomes, making this support likely to remain strong. Price may consolidate further before the next directional move is determined.