Gold and Silver Rise on Safe-Haven Demand Amid Mild U.S. PPI Data

By Daniel M.

April 12, 2024   •   Fact checked by Dumb Little Man

Gold’s Unstoppable Climb

Gold continues its amazing rise, surpassing prior highs. Despite concerns about fewer Federal Reserve rate cuts and a strengthening US dollar, the commodity remains supported by strong central bank purchases and increased retail demand, particularly from Chinese citizens. 

Gold has touched the 1.618% Fibonacci extension of its 2020-2022 major drop, with a potential resistance level of $2,360

Gold Weekly Chart

Source: Chart by TradingView via DailyFX

Despite a modest pullback from this level, the general trend remains extremely bullish, as evidenced by overbought conditions on the Relative Strength Index (RSI) and prices being far above the key moving averages.

Gold Daily Chart

Source: Chart by TradingView via DailyFX

Silver Faces Resistance but Maintains Bullish Trend

Similarly, silver has faced resistance near $28.40, a level that previously served as a ceiling during the COVID-19 pandemic rise. Despite this, silver’s next upside goal is $30.10, attempting to recoup all losses from 2021 to 2022. 

Silver Weekly Chart

Source: Chart by TradingView via DailyFX

The metal’s daily chart shows a stabilization below this level, with an overbought RSI indicating that the market may require a break.

Silver Daily Chart

Source: Chart by TradingView via DailyFX

Market Dynamics and Technical Analysis

The precious metals market rose in noon trade, boosted by a somewhat less severe than expected U.S. inflation report, which increased the appeal of gold and silver as safe-haven assets

Technical indicators point to a strong positive outlook for both metals, with gold aiming for a close over $2,400 and silver trying to reach $30.00.

Economic Indicators and External Factors

Recent economic data has shown a mixed picture. The U.S. Producer Price Index (PPI) increased by 0.2% in March, implying that inflationary pressures may be lessening

Meanwhile, Chinese inflation data showed deflationary trends, perhaps prompting additional economic stimulus measures. Geopolitical worries, including as potential military intervention in the Middle East, have also encouraged safe-haven purchases.

Final Thoughts

Gold and silver prices remain impacted by a complex combination of technical elements, economic data, and geopolitical events. Traders should keep a careful eye on these trends since they present both possibilities and threats

The resilience of precious metals in the face of diverse economic uncertainty emphasizes their value as safe-haven assets. As the market navigates these elements, traders hoping to profit from these patterns must keep a close eye on resistance levels and market indicators.


Daniel M.

Daniel Moore is a seasoned trading analyst with over 20 years of experience navigating the ever-evolving financial landscape. Renowned for his unconventional yet effective approach, Daniel utilizes a blend of technical and fundamental analysis to identify hidden gems and craft winning trade strategies. He is a master at demystifying complex market data and translating it into actionable insights for traders of all experience levels.

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