The 4-hour chart for spot silver also shows consolidation within the negative territory below the support line of the ascending broadening wedge pattern. If the price fails to recover above the $80 area in the short term, then the possibility of a breakdown in silver will likely be higher. However, any drop toward the $50 to $60 level will be considered a buying opportunity.
Bottom Line
In conclusion, gold and silver continue to feel the heat as oil related inflation keeps the Federal Reserve on the alert and delays rate cuts. Gold continues to have short term weakness as it trades below $5,000. The zone of $4,400 -$4,500 is critical area to observe. A break below this area may see gold slide towards the 200-day SMA around $4,280. On the other hand, a break above $5,000 will enhance the bullish picture. Silver appears to be stronger than gold due to its industrial demand, but it also needs to maintain $70 to keep the bullish momentum.
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