Silver (XAG) also consolidates above the long term support zones and lags behind gold. The momentum in silver can accelerate once investor confidence increases. The decline in the dollar and recovery in the metals served as a boost to silver in attracting new buyers. Meanwhile, the silver is more prone to the general market sentiment. Therefore, if the ceasefire is breached and oil spikes again, it can be exposed to new volatility.
Gold Technical Analysis: Bullish Structure Maintains Below $4,900
The gold price is consolidating below the key level of $4,800 discussed previously. The price has been consolidating during the past three weeks and is looking for the next direction. This resistance is also defined by the 50-day SMA, whereby a break above $4,900 will trigger a strong rally towards the $5,200 area.
However, a failure to break above this level will initiate a strong drop towards the $4,400 region. The RSI is also consolidating around the mid-level which increases uncertainty in the gold market.
Overall, the price structure for gold remains strongly bullish, as seen by the ascending broadening wedge pattern. This price structure is also volatile due to the formation of broadening wedge patterns.
