By NewsBlogger The article provides an analysis and market outlook on the surge in Silver (XAG/USD) and Gold Price (XAU/USD), highlighting technical indicators, economic factors, and geopolitical tensions that may impact the precious metals market.
At a glance
- Silver (XAG/USD) has seen a positive trend for the third consecutive day, hovering around $25.15.
- Resistance is expected in the $25.65-$25.75 region, with sustained strength above $26.00 likely to resume uptrend.
- Support levels are near $24.65, $24.35, and $24.15-$24.10, with a potential drop towards the 200-day SMA at $23.35-$23.30.
- US economy showing signs of resilience, impacting XAG/USD trading near $24.98 level.
- Gold price (XAU/USD) reached all-time highs of nearly $2,250 per troy ounce, influenced by various factors, including geopolitical tensions and expectations of easing monetary policies.
The details
Silver (XAG/USD) and Gold Price (XAU/USD) Surge: Analysis and Market Outlook
Silver (XAG/USD) has seen a positive trend for the third consecutive day, with prices currently hovering around the $25.15 region, just below a one-week high.
Technical indicators on the daily chart present a mixed outlook, urging caution for bullish traders.
A potential move upwards is expected to encounter resistance in the $25.65-$25.75 region, with sustained strength above $26.00 likely to resume the recent uptrend observed since late February.
Support and Resistance Levels
Conversely, a drop below $25.00 may attract buyers near the $24.65 level, with a critical pivot point at the $24.35 resistance-turned-support zone.
A breach below $24.35 could shift the bias in favor of bearish traders, leading to further support levels near $24.15-$24.10 and eventually the $24.00 mark.
Continued selling pressure could accelerate the downward trajectory towards the 200-day Simple Moving Average (SMA) around the $23.35-$23.30 region.
Market Analysis and Economic Indicators
The XAG/USD pair is currently trading near the $24.98 level, with the US economy displaying signs of resilience.
Positive data from the Institute for Supply Management (ISM) report and Manufacturing Purchasing Managers’ Index (PMI) indicate strength in the economy, with the PMI surpassing forecasts to reach 50.3 in March.
The Prices Paid Index in the ISM report also hit an annual high of 55.8. These factors suggest that the Federal Reserve (Fed) is less likely to implement a monetary policy easing, as evidenced by the drop in the likelihood of a rate cut at the Fed’s June meeting from 85% to around 65%.
US Treasury bond yields have surged, with key labor market indicators such as Nonfarm Payrolls, Average Hourly Earnings, and the Unemployment Rate highly anticipated.
While the Relative Strength Index (RSI) for XAG/USD remains positive, the Moving Average Convergence Divergence (MACD) is in negative territory.
Furthermore, the XAG/USD pair is currently trading above the 20-day, 100-day, and 200-day Simple Moving Averages.
In the gold market, the XAU/USD price has reached all-time highs of nearly $2,250 per troy ounce during the early Asian session on Monday.
Various factors have contributed to this surge, including expectations of a Federal Reserve (Fed) pivot in the second half of 2024, ongoing geopolitical tensions in the Middle East, and hopes for China’s economic recovery.
Anticipation of easing monetary policies by major central banks could further boost gold prices, with financial markets pricing in a 68.5% probability of a quarter-point rate cut from the US Fed by June.
Fed Chairman Jerome Powell’s remarks on recent US inflation data being in line with expectations have also influenced market sentiment.
Lower interest rates may enhance the appeal of gold as an investment, particularly as it is a non-interest-bearing asset.
Additionally, reports of attacks by Hezbollah on Israeli troops have heightened tensions in the Middle East, potentially increasing safe-haven flows that benefit the gold price.
Positive Chinese Purchasing Managers Index (PMI) data for March, along with upcoming data releases such as China’s Caixin Manufacturing PMI and US ISM Manufacturing PMI, are expected to impact market dynamics further.
Looking ahead, traders will closely monitor the evolving market conditions, with a stronger-than-expected US PMI report likely to boost the US Dollar (USD) and potentially limit the upside potential of the gold price in the near term.
The intricate interplay of economic indicators, geopolitical events, and central bank policies underscores the dynamic nature of the precious metals market, offering both challenges and opportunities for investors and traders.
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| fxstreet.com |
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| – Silver (XAG/USD) has gained positive traction for the third successive day on Monday – Currently trading around the $25.15 region, just below a more than one-week top – Mixed technical indicators on the daily chart warrant caution for bullish traders – Subsequent move up likely to face resistance near $25.65-$25.75 region – Sustained strength beyond $26.00 could resume recent uptrend since late February – Weakness below $25.00 may attract buyers near $24.65 region – Key pivotal point at $24.35 resistance-turned-support zone – Break below $24.35 could shift bias in favor of bearish traders – Next relevant support near $24.15-$24.10 region en route to $24.00 mark – Follow-through selling could accelerate downward trajectory towards 200-day Simple Moving Average (SMA) around $23.35-$23.30 region |
| fxstreet.com |
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| – XAG/USD pair trading near $24.98 level – US economy showing signs of resilience – Institute for Supply Management (ISM) report and Manufacturing Purchasing Managers’ Index (PMI) both positive – PMI climbed to 50.3 in March, surpassing forecasted 48.4 – ISM report’s Prices Paid Index at annual high of 55.8 – Federal Reserve (Fed) less likely to ease monetary policy – Likelihood of rate cut at Fed’s June meeting dropped from 85% to around 65% – US Treasury bond yields surged – Key US labor market indicators highly anticipated – Nonfarm Payrolls, Average Hourly Earnings, and Unemployment Rate to provide insights – Relative Strength Index (RSI) positive for XAG/USD – Moving Average Convergence Divergence (MACD) in negative territory – XAG/USD above 20-day, 100-day, and 200-day Simple Moving Averages |
| fxstreet.com |
|---|
| – Gold Price (XAU/USD) reaches all-time highs of nearly $2,250 per troy ounce during early Asian session on Monday – Factors contributing to rise in gold price include expectations of Federal Reserve (Fed) pivot in second half of 2024, ongoing geopolitical tensions in Middle East, and hope for China’s economic recovery – Expectation of easing monetary policy from major central banks may boost gold prices – Financial markets have priced in 68.5% odds of quarter-point rate cut from US Fed by June – Fed Chairman Jerome Powell stated recent US inflation data was “along the lines of what we would like to see” – Lower interest rates may lift gold price as gold becomes a better investment due to being a non-interest-bearing asset – US Personal Consumption Expenditures Price Index (PCE) rose 2.5% YoY in February, in line with expectations – Core PCE, which excludes volatile food and energy prices, climbed 2.8% YoY and 0.3% MoM – Hezbollah claimed to have carried out seven attacks on Israeli troops, raising tension in Middle East and potentially boosting safe-haven flows benefiting gold price – Chinese Purchasing Managers Index (PMI) data for March showed improvement, supporting gold price – Traders will focus on China’s Caixin Manufacturing PMI for March and US ISM Manufacturing PMI – Stronger-than-expected US PMI report could boost US Dollar (USD) and limit upside of gold price in near term |
