Precious metals opened the week with a sharp bout of volatility, led by a thin-market surge in Silver that briefly carried prices to fresh record highs just below 84. The rally, however, quickly lost momentum, and the retreat in both Silver and Gold suggests consolidation is now the more likely path, rather than immediate continuation. After an extended run, profit-taking has begun to surface, particularly as markets reassess near-term risk drivers.
Part of the pullback has been attributed to tentative optimism around peace discussions in Ukraine. While headlines have eased some immediate safe-haven demand, broader geopolitical risks remain firmly in play. East Asia is now a focal point after China conducted live-fire drills around Taiwan under its “Justice Mission 2025” exercises, deploying troops, warships, fighter jets, and artillery. Macro support also remains intact. Expectations for extended policy easing by the Federal Reserve in 2026, alongside persistent Dollar weakness, should limit the downside for both Gold and Silver once consolidation matures.
Technically, Silver’s upside acceleration was stronger than expected, as exaggerated by thin market. 200% projection of 36.93 to 54.44 from 48.60 at 83.52 was already met.
Considering the strength of the latest upleg and the depth of the subsequent pullback, a short term top was likely formed and some time is needed to digest to move. Hence, more sideway trading is expected in the coming days.
For now, initial support should be found at 38.2% retracement of 48.60.to 83.94 at 70.44, which is slightly above 55 4H EMA (now at 69.49) to contain downside. Range trading is expected between 70 and 84 for consolidations.
The prospect of extending the powerful up trend to 261.8% projection at 94.34 remains alive. However, firm break of 70 will indicate that it’s already in a medium term correction, instead of a near term one.
Gold has clearly underperformed Silver on the strength of latest rise. For now, some consolidations would be seen below 4549.90 high.
Firm break of 55 4H EMA (now at 4410.98) would bring deeper pullback towards 4319.71 support. But strong support is expected there to bring rebound, and set the base for extending the up trend at a later stage.
However, further break of 4319.71 will suggest that Gold is in a deeper correction towards 55 D EMA (now at 4159.42). It this happen, it would also be taken as a signal of similar deeper correction in Silver too.
