Gold surged to another record in Asian trading today, edging toward 3800 level, while Silver held firm around 46.5 after last week’s sharp 7% rise. Both metals remain supported by low interest rates and geopolitical risks, but the relentless rally is entering territory where traders should start to grow more cautious.
For Gold, the technical outlook still points higher as long as 3717.24 support holds. Immediate upside target is 61.8% projection of 2584.24 to 3499.79 from 3267.90 at 3833.79. Yet as prices stretch further, momentum could start fading even as new highs are made, on overbought conditions.
The 4000 psychological barrier looms as a potential turning point. That zone also aligns with the 261.8% projection of 1160.17 to 2074.84 from 1614.60 at 4009.20, making it an ideal level for a major top. Traders should view this area as one to scale out, not chasing higher.
As Gold could also complete its five-wave rally from 1046.27 (2015 low), reversal at or near 4000 could be steep. The next meaningful correction might drag Gold quickly back toward 55 W EMA (now at 3113.80).
Silver carries similar warning signs. With support intact at 43.75, further rise should be seen to 100% projection of 28.28 to 39.49 from 36.93 at 48.14. But momentum is already running into a zone where upside looks limited relative to risk.
Between 161.8% projection of 21.92 to 34.84 from 28.28 at 49.18 and 50 psychological level, Silver faces a heavy resistance band that could complete its five-wave rally from 17.54 (2022 low). If rejected by 50, the metal could retrace rapidly, mirroring the kind of correction gold risks at 4000.
The message is clear: while fundamentals still favor precious metals, the technical picture is flashing caution. Traders should be tightening stops and locking in gains above 3800 in Gold and 48 in Silver, and be prepared for the possibility of sharp reversals.
