Gold (XAU) Silver (XAG) Daily Forecast: Will Economic Recovery Boost Prices Further?

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Published: Jan 2, 2025, 08:01 GMT+00:00

Key Points:

Gold prices climb to $2,636, driven by central bank demand, geopolitical risks, and a weaker US Dollar's influence.
Silver trades at $29.33, benefiting from safe-haven demand and optimism around China's improving economic outlook.
Geopolitical tensions in Eastern Europe and the Middle East push investors toward Gold and Silver for stability.

Gold (XAU) Silver (XAG) Daily Forecast: Will Economic Recovery Boost Prices Further?

Market Overview

Gold prices (XAU/USD) extended their bullish momentum, trading near $2,633.83 and reaching an intra-day high of $2,636. This rise reflects a combination of monetary easing, heightened geopolitical risks, and record central bank demand. According to the World Gold Council, 2024 saw a 27% increase in Gold prices, marking its best annual performance since 2010, driven by lower interest rates and growing uncertainties.

A weaker US Dollar, trading at approximately 108.30, further supports Gold. As the Dollar loses strength, Gold becomes more affordable for foreign investors, boosting its appeal. Additionally, China’s economic recovery is expected to provide tailwinds for Gold in 2025. President Xi Jinping’s commitment to growth has raised expectations for stimulus measures, despite recent slower manufacturing growth.

Silver Benefits from Safe-Haven Demand and Economic Optimism

Silver (XAG/USD) mirrored Gold’s upward trajectory, trading at $29.33 with an intra-day high of $29.36. Its affordability relative to Gold makes it an attractive option for investors seeking safe-haven assets amid global uncertainties. Central bank interest, coupled with the weakening Dollar, adds further support to Silver prices.

China’s improving economic outlook and recovering construction and service sectors are also driving demand for industrial metals like Silver. As a dual-purpose metal, Silver benefits from both its industrial and safe-haven qualities, positioning it for continued growth.

Geopolitical Tensions and Central Bank Actions Drive Prices

Persistent geopolitical risks, including escalating tensions in Eastern Europe and the Middle East, have heightened demand for safe-haven assets. Russia’s drone strikes on Ukraine and military operations in Gaza have amplified global uncertainties, steering investors toward Gold and Silver.

Central bank purchases remain a cornerstone of support for precious metals. The World Gold Council forecasts sustained buying in 2025, reinforcing upward momentum for both Gold and Silver as investors navigate an environment marked by geopolitical instability and economic recovery.

Short-Term Forecast

Gold prices hover near $2,633.83, testing resistance at $2,652.90 amid bullish momentum. Silver trades at $29.32, eyeing $29.88, supported by strong demand.

Gold Prices Forecast: Technical Analysis

Gold (XAU/USD) is trading at $2,633.83, up 0.36% in the last session, reflecting steady buying interest. The pivot point at $2,628.47 serves as a crucial support level, with immediate resistance at $2,652.90 and further upside capped by $2,675.33. On the downside, key support levels are at $2,603.83 and $2,584.16, offering near-term protection.

Technical indicators suggest a mixed outlook. Gold remains above its 50 EMA at $2,620.80, signaling short-term bullish momentum, but is testing its 200 EMA at $2,632.78, which could limit gains. A sustained break above $2,652.90 may attract further buying, while a drop below $2,628.47 could signal a shift to bearish sentiment.

Traders should watch for a decisive move around $2,628 to confirm the next trend.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver – Chart

Silver (XAG/USD) is trading at $29.32, up 1.48% in the last session, showing renewed bullish momentum. The pivot point at $29.37 is a key threshold, with immediate resistance at $29.88 and a further barrier at $30.27. On the downside, support levels lie at $28.78 and $28.41, providing a cushion against selling pressure.

Technical indicators highlight mixed signals. Silver trades above its 50 EMA at $29.26, indicating short-term strength, but remains below its 200 EMA at $29.95, suggesting potential longer-term resistance. A sustained break above $29.37 could pave the way for gains toward $30.27, while failure to hold above this level might trigger a pullback toward $28.78.

Keep an eye on volume and the $29.37 pivot for directional cues.

About the Author

Arslan Aliauthor

Arslan, a webinar speaker and derivatives analyst, has an MBA in Finance and MPhil in Behavioral Finance. He guides financial analysis, trading, and cryptocurrency forecasting. Expert in trading psychology and sentiment.