Gold (XAUUSD) & Silver Price Forecast: Trade Tensions Fuel Safe-Haven Rally

Market Overview

Gold (XAU/USD) held firm above the $3,200 mark during early Asian trading, building on gains after Monday’s brief pullback. Investors continue to favor the metal as trade frictions between the U.S. and China escalate and expectations rise for a more accommodative Federal Reserve stance later this year.

Silver (XAG/USD) followed suit, trading at $32.05 after hitting an intra-day high of $32.39.

The metal is drawing strength from the same dynamics—safe-haven flows and a weakening U.S. dollar—boosting its appeal as an alternative asset in a risk-averse environment.

Tariff Escalation and Policy Uncertainty Drive Haven Demand

Market anxiety deepened after China raised tariffs on U.S. goods to 125%, in direct response to Washington’s hike to 145% on Chinese imports. The tit-for-tat escalation has rattled investor confidence and amplified concerns about global growth.

Further uncertainty came as the U.S. signaled upcoming tariffs on semiconductors and potentially pharmaceuticals—despite temporary exemptions for key electronics.

The heightened policy volatility, coupled with America’s import reliance, has strengthened the case for gold as a portfolio hedge.

Rate Cut Bets Undermine Dollar, Lift Precious Metals

The U.S. dollar remains under pressure, hovering near its lowest levels since April 2022. Markets are pricing in up to three rate cuts in 2025, as Fed officials acknowledge downside risks.

Governor Christopher Waller flagged tariffs as a meaningful economic headwind, while Atlanta Fed President Raphael Bostic noted limited policy flexibility amid price pressures.

The resulting weakness in the dollar has provided further tailwinds for gold and silver, both of which are sensitive to shifts in real yields and currency moves.

Upcoming Data and Powell’s Speech in Focus

Investors are eyeing Tuesday’s release of the Empire State Manufacturing Index for early signs of economic softness. However, attention will likely center on Fed Chair Jerome Powell’s remarks on Wednesday, expected to offer more clarity on how the central bank plans to navigate inflation risks and trade-driven headwinds in the second half of the year.

Short-Term Forecast

Gold consolidates above $3,200 with support from Fed rate cut bets and trade tensions. Silver eyes $33.25, holding firm within a rising channel as bullish momentum stays intact.

Gold Prices Forecast: Technical Analysis

Gold is consolidating around $3,226, following a sharp breakout from the $3,195–$3,245 range (highlighted zone). The rally appears to be cooling off slightly, but buyers are still in control, with the pivot point holding steady at $3,194. Immediate resistance remains at $3,245, with the next barrier at $3,260.

On the flip side, a slip below $3,195 could open the door to $3,163. The 50 EMA at $3,206 is tracking the price closely, supporting the short-term uptrend, while the 200 EMA at $3,131 underpins the broader bullish structure.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver has carved out a clean rising channel, holding above the pivot point at $32.05 as buyers push toward higher ground. The current price of $32.26 hovers just below immediate resistance at $32.67, with the next upside target set at $33.25. Support rests near $32.05, and below that, stronger footing lies at $31.34.

The 50 EMA at $31.64 is rising steadily and acting as a dynamic support, while the 200 EMA at $32.05 has been reclaimed—adding conviction to the bullish bias.