- The price of gold is in a bearish trend for the second day.
- The price of silver continues its bearish trend for the second day, and now we have fallen below the $20.00 level.
- Despite last week’s softer US CPI report, Fed officials stressed that it was too early to declare victory over inflation and maintained a hawkish tone.
Gold chart analysis
The price of gold is in a bearish trend for the second day. Yesterday we encountered resistance at the $1800 level, and during the Asian session, the price continued to pull back below the $1780 level. Today’s low is at the $1770 level. At that level, we have some support. The dollar is in a bullish trend this week, and such a scenario is very bad for the price of gold. We need a continuation of today’s negative consolidation and a further pullback below the $1770 level for a bearish option. After that, the price of gold could make a deeper pullback. Potential lower targets are $1760 and $1750 levels. We need a new positive consolidation and a return above the $1780 level for a bullish option first. After that, the price could move to the next resistance zone at the $1790 level. Potential higher targets are $1800 and $1810 levels.
Silver chart analysis
The price of silver continues its bearish trend for the second day, and now we have fallen below the $20.00 level. A strong dollar could push the price even lower. We must continue the negative consolidation and stay below the $20.00 level. Potential lower targets are $19.75 and $19.50 levels. The moving averages are now on the bearish side, and they further complicate and direct the movement of the silver price. For a bullish option, we need a new positive consolidation and a return above the $20.00 level. After that, the price of silver could continue to the $20.25 level, then to the $20.50 higher resistance level. A break above could once again take us up to the $20.75 level.
Despite last week’s softer US CPI report, Fed officials stressed that it was too early to declare victory over inflation and maintained a hawkish tone. This suggests that the Fed will stick to its policy-tightening path and continue to support the dollar. Investors will likely look for clues on the possibility of a larger rate hike of 0.75% in September. This could affect the short-term price dynamics of the USD and commodities denominated in dollars.
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