Today’s analysis offers a comprehensive overview of the gold and silver markets, highlighting the key fundamental and technical factors influencing current trends. This report is designed to provide investors with valuable insights to navigate these markets with confidence and clarity.
Gold prices faced selling pressure on Thursday due to profit-taking activity, following the release of the US Nonfarm Payrolls data, which showed an increase of 147,000 jobs in June, according to the US Bureau of Labour Statistics. This figure came in higher than both the previous month’s revised count of 144,000 (from 139,000) and the market expectation of 110,000. Additional elements of the employment report revealed that the Unemployment Rate decreased slightly to 4.1% from 4.2%, while the labour force Participation Rate edged down to 62.3% from 62.4%. Meanwhile, annual wage growth, as measured by the Average Hourly Earnings, slipped to 3.7% from 3.8% in May, missing analysts’ expectations of 3.9%.
Gold prices experienced a sharp decline followed by a recovery from intraday lows amid high volatility on Thursday. Still, the pullback remained in line with this week’s breakout above the 200-hour Moving Average, which continues to serve as a key technical trigger for XAU/USD bulls. Furthermore, momentum indicators on the daily chart have started to build upward strength again, indicating that the overall trend may favour further gains. As such, any short-term dips could still be considered buying opportunities, with strong support likely near the $3,328 level. A firm break below this level, however, could trigger technical selling, potentially driving prices toward the $3,300 psychological level. On the upside, immediate resistance is expected in the $3,361–$3,375 range, above which Gold may set its sights on the $3,400 barrier. The short-term Stochastics Oscillator currently reads 60, while the Relative Strength Index (RSI) stands at 51.
Silver made an unsuccessful attempt to break and hold above the $37.00 level, as the gold/silver ratio remains elevated above 90, highlighting relative underperformance in silver compared to gold.
Should silver regain the $37.00 level, it could pave the way for a move toward the next resistance zone between $37.35 – $37.50. However, the Moving Average Convergence Divergence (MACD) histogram and signal line on the daily chart have turned lower, indicating a loss of upward momentum.
Despite this, the Relative Strength Index (RSI 14) continues to trade above the key 50 threshold, currently at 62, suggesting that bearish pressure may be limited. This calls for caution among XAG/USD bears, as downside moves could be short-lived.
Any pullback below $36.00 may be viewed as a buying opportunity, with strong horizontal support expected near $35.50.
Stochastics Oscillator: 71
Relative Strength Index (RSI): 62
Stochastics Oscillator: A momentum indicator that compares a security’s closing price to its price range over a specific period. Readings above 80 typically indicate overbought conditions, while readings below 20 suggest oversold levels.
Relative Strength Index (RSI): An indicator that measures the speed and magnitude of recent price changes to assess market conditions. A value above 70 signals overbought conditions, while a reading below 30 indicates oversold territory.
In the dynamic and ever-evolving landscape of the bullion markets, staying informed through a combination of technical and fundamental analysis is essential for making sound investment decisions. This report aims to provide a balanced perspective, helping investors navigate the complexities of gold and silver trading with greater clarity and confidence.