Gold and silver investors are keeping a close eye on the market this week as new catalysts emerge. Last week, gold experienced a slight rise after a consecutive two-week loss, but Friday’s price action indicates a potential pullback in the coming days.
Currently, gold is trading down from the $1985 level, with the next support level at $1937. This level is significant as it aligns with the 200-day simple moving average (SMA). The recent weaker dollar and decreased US yields have contributed to the temporary support for gold after the US CPI print-inspired dollar selloff.
One potential catalyst for gold this week is the release of the FOMC minutes, which could impact the value of the precious metal. Additionally, the ongoing Israel-Hamas conflict may play a role in gold’s performance, as a new phase in the war could lead to increased demand for the safe haven asset.
Meanwhile, silver also had a strong week, reaching channel resistance and the 50% Fibonacci retracement. However, the metal has encountered resistance at these levels and has started the week in a downward trend. Support levels for silver are currently at $22.35 (38.2% Fib) and $20.52 (23.6% fib retracement).
Traders and investors should pay attention to the expected 30-day gold volatility, which has been decreasing recently. While this trend may limit the potential for significant spikes in gold prices, the metal remains in a favorable position to benefit from continued USD selling and lower US yields.
To stay updated on the latest market commentary and analysis, readers are encouraged to sign up for the DailyFX newsletter, where they can receive timely insights from the DailyFX team.