Silver came close to a fresh ATH last night and Gold held right at the 4500 level, which was then followed by decisive pullback moves in both markets. This begs the question as to whether we have a near-term high already in-place as U.S. data becomes the next focal point.
Metals markets have continued to move in the New Year and both Silver and Gold came close to setting significant highs yesterday. In Gold, it was all about the $4500/oz psychological level while Silver futures came close to setting a fresh all-time-high, shying away just eight cents inside of the high watermark from late December. Both markets have since pulled back and naturally that brings on question as to whether a top is in-place, but to address that up front, it’s far too early to consider that possibility as this is more likely driven by profit taking ahead of the NFP report for later in the week.
Given the impact of Fed policy which is then built around expectations coming from U.S. data, it’s been a murky past few months given the U.S. government shutdown. That’s obscured insight into how well the world’s largest national economy is performing but we’re now getting to the stage where the lag on that data is growing less and less significant.
The big concern of late has been the U.S. labor market, and this draws back to August 1st. That seems an important inflection point in this saga as it was just two days after the FOMC rate decision at which Jerome Powell said that he didn’t think policy was overly restrictive. The USD broke out and both Silver and Gold sold off; but this was offset just two days later when the NFP print came along with a massive revision-down in prior months’ data, leading to the build of expectations for the Fed to cut rates later in the year.
Powell opened that door for rate cuts just a few weeks later at the Jackson Hole Economic Symposium and both Gold and Silver broke out in big ways, and those rallies have largely continued as the Fed cut three times at 25 bps each, helped along by that opacity in lacking data thanks to the government shutdown.
So, logically, if we see weak U.S. labor numbers then USD bears and Gold and Silver bulls can retain argument for higher prices. If this is coupled with inflation data that’s not surprisingly high, that argument is probably even more attractive. So, it appears as though what we’re seeing now is function of longs taking profit ahead of a major data point following a massive run in both markets.
In Silver, that run has been especially noticeable as Silver futures were trading below $50 just in November and now we’re more than 40% higher and it’s the $80 level that buyers have been vying for acceptance above. From the April low, Silver prices have been up as much as 200%, which means there’s like a lot of long positioning that will look to defend unrealized profits as we move into events such as we have with Friday’s NFP report.
Silver Futures Daily Chart
Chart prepared by James Stanley; data derived from Tradingview
Silver Price Structure
At this point price action retains a bullish lean as it was the 70-level that was vigorously defended by bulls on three separate occasions ahead of the 2026 open. And at this stage, there’s a case to be made for possible higher-low support, if we can see buyers defend a big zone of importance from 75-75.50 or even the 72.75 level that’s just a little-lower.
Silver Futures Four-Hour Chart
Chart prepared by James Stanley; data derived from Tradingview
Gold
While gold has had a similar drive as Silver it’s not quite as built-up, and thus the long positioning in the market likely isn’t as one-sided as the scenario looked at above. But – I think the more notable fact here is that Gold has so far held a lower-high at $4500/oz while Silver has come just pennies away from setting a fresh ATH. So I wouldn’t quite want to rule out continuation potential in either market.
With that said, I’m still cautious of chasing here as there’s been clear reaction to the $4500 level and until there’s a good reason for bulls to push highs beyond that price, I think we could continue to see some degree of profit taking around that level.
Inside price action, however, remains a viable approach and we’ve seen that so far this week with support tests at clean levels like 4402 and again this morning, at least so far, with 4442. Even a deeper pullback wouldn’t necessarily rule out the possibility of topside continuation setups, at least until we breach the 4351 level which would point to the possibility of a push down into the 4260 zone.
Until then, I’m tracking support levels at 4442, 4402, 4378 and then 4351 in spot Gold (XAU/USD).
Gold (XAU/USD) Four-Hour Chart
Chart prepared by James Stanley; data derived from Tradingview
--- written by James Stanley, Senior Market Analyst, Global Macro
