Gold and Silver Technical Forecast: Precious Metals at Risk

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Gold and Silver Weekly Technical Forecast: Mixed

  • Gold bounced off the 50 SMA forward of the 1774 degree, nearing a 50 % retracement of the prior advance
  • Silver strikes decrease, testing an important degree of assist, threatening to trade at lows not seen since 2020

Gold Sees Upside Rejection at 50 SMA, Vulnerable to Move Lower

While it is a technical piece, we can’t disregard the truth that Jerome Powell’s handle at the Jackson Hole Economic Symposium got here throughout as somewhat hawkish nonetheless the Fed chairman did throw a small lifeline to doves mentioning that as coverage tightens additional it will likely be becoming to halt the tempo of price rises at a while.

The greenback instantly traded decrease however have since then greater than reversed these losses and achieve some power into the tip of the week. Naturally we noticed a concerted transfer decrease in gold.

Gold’s technical panorama is somewhat complicated at the second, at present’s bearish worth motion has all however erased the latest countertrend rallywhich has gold nearing the August and September 2021 lows at round 1722. The countertrend rally was stored at bay by the 50-periodeasy transferring common (SMA).

Should markets proceed the bearish momentum initiated by the hawkish Powell, we might see gold retest it is latest lows at round 1676.70 within the coming week. The difficulty with gold at the second is we’re buying and selling in ‘no man’s land’ – someplace in the midst of the medium-term bullish transfer initiated after the July low and the bearish retracement of that transfer which started mid-August.

This present market posture makes it troublesome to evaluate future course and due to this fact informs the mixedevaluation of this report.

Gold (XAU/USD) Daily Chart

Source: Buying and sellingView, ready by Richard Snow

The weekly chart in gold helps current the numerous degree of assist at 1676.70 which has acted as a pivot level for priorextreme, impulsive bearish strikes.

Gold (XAU/USD) Weekly Chart

Gold Weekly Chart

Source: Buying and sellingView, ready by Richard Snow

Gold-Silver Ratio Maintains Uptrend at Extremes – Suggests Gold Could Sell-off

Something attention-grabbing to notice is the gold-silver ratio, which makes an attempt to function a sign of future gold and silver motion. Currently the gold-silver ratio stays round excessive historic ranges (80-100) and each gold and silver charts are in a downtrend; which means we might see gold promoting outpace that of silver. Of course, its all the time prudent to let worth motion be your information first and foremost.

For extra on the subject, learn our devoted article on the gold-silver ratio.

Gold-Silver Ratio (Monthly Chart)

Gold-Silver Ratio

Source: Buying and sellingView, ready by Richard Snow

Silver (XAG/USD) Provides a Clearer Guide to Bearish Continuation

The silver chart however gives us with a clearerhurdle for bearish continuation. Firstly, the latest advance fell wanting testing the zone of resistance(prior assist) between 21.40 and 22.10, with the turning level at 20.87.

After Powell’s handle, silver close tos the zone of assist which connects the 61.8Fibonacci retracementof the 2020-2021 main transfer; and the 18.65 degree referring to the 2019-2020 degree of resistance. A break under the zone of assist within the coming week would spotlight 1695 as the subsequent degree of assist with 15.65 nonetheless a great distance away.

Silver (XAG/USD) Daily Chart

Silver Daily Chart

Source: Buying and sellingView, ready by Richard Snow

— Written by Richard Snow for DailyFX.com

Contact and comply with Richard on Twitter: @RichardSnowFX





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