• Gold drops amid rising US Treasury yields and a stronger US Dollar.
• US equity downturn and job market worries heighten market jitters ahead of Nonfarm Payrolls.
• Fed’s Goolsbee suggests cautious monetary policy, impacting gold amidst global trade tensions.

Gold price advance stalled on Thursday as United States (US) Treasury bond yields recovered, and the Greenback holds minimal gains. Traders seem to be booking profits ahead of the release of the latest US Nonfarm Payrolls report, which could spark volatility in the financial markets. XAU/USD traded at $2,852, down 0.38%.

With no clear catalyst, the market mood shifted negatively as US equity indices turned lower. Despite this, the non-yielding metal continued to trim some of its weekly gains amid increased tensions due to the trade war between China and the US.

In addition, US jobs data showed that the number of people applying for unemployment benefits rose in the week ending February 1, revealed the US Department of Labor. A Bloomberg report said the report was mainly ignored due to distortions spurred by wildfires in Los Angeles and worse weather conditions in other parts of the US.

Bullion failed to gain traction amid dovish comments by Chicago Fed President Austan Goolsbee. He said the Fed is in good shape for eventual cuts, though he added that uncertainty around Washington policies warrants a “slower approach.”

Daily digest market movers: Gold price weighed by US yields recovery

• The US Dollar Index (DXY), which tracks the buck’s performance versus a basket of six currencies, holds minimal gains of 0.06% and is at 107.68.
• The US 10-year Treasury bond yield climbs one and a half basis points, up at 4.44%.
• US real yields, which correlate inversely to Bullion prices, climb one and a half basis points from 2.01% to 2.0026%, a tailwind for XAU/USD.
• For the week ending February 1, US Initial Jobless Claims increased to 219K, up from 208K the previous week and surpassing forecasts of 213K. This rise indicates more Americans filed for unemployment benefits than expected.
• US Nonfarm Payrolls in January are expected to dip from 256K to 170K. The Unemployment Rate is projected to remain unchanged at 4.1%.
• Money market fed funds rate futures are pricing in 47.5 basis points (bps) of easing by the Federal Reserve in 2025.

XAU/USD technical outlook: Gold price falls below $2,860

Despite dipping, the XAU/USD pair is poised to extend its rally and challenge the year-to-date (YTD) high of $2,882 ahead of $2,890. Once those two levels are cleared, the next resistance would be $2,900.

The Relative Strength Index (RSI) remains at overbought territory. Still, as previously mentioned, “it hasn’t reached the most extreme level above 80, which could pave the way for a mean-reversion trade.”

Therefore, XAU/USD fell to a daily low of $2,834, but buyers lifted Gold prices above $2,850, opening the door for further upside.

Conversely, if Bullion plunges below $2,800, immediate support would be the January 27 swing low of $2,730, followed by $2,700.

• Silver price holds ground near its three-month high of $32.56, recorded on February 5.
• The upside of the Silver appears limited as the US Dollar gains ground amid rebounding US Treasury yields.
• Traders await US Nonfarm Payrolls to gain fresh impetus regarding the Fed’s monetary policy direction.

Silver price (XAG/USD) remains in positive territory for the fifth consecutive session, trading around $32.30 per troy ounce during Asian hours on Friday. The precious metal maintains its position near its three-month high of $32.56, recorded on February 5. Traders are awaiting key US labor market data, including Nonfarm Payrolls (NFP), which could influence the Federal Reserve’s (Fed) monetary policy direction.

However, Silver’s upside appears limited as the US Dollar (USD) extends its recovery amid rebounding US Treasury yields. The US Dollar Index (DXY), which tracks the USD against six major currencies, has climbed near 107.70, while 2-year and 10-year US Treasury yields stand at 4.22% and 4.43%, respectively, at the time of writing.

Safe-haven metals like Silver have gained ground amid heightened risk aversion due to global trade and economic uncertainties. However, trade negotiations between the United States (US) and China could temper this sentiment. US President Donald Trump and Chinese President Xi Jinping are set to discuss potential tariff rollbacks, which could ease market concerns and limit Silver’s upside.

Diminished fears of a US-China trade war also reduce the risk of rising US inflation, reinforcing expectations of two Federal Reserve rate cuts this year. As a non-yielding asset, Silver benefits from a dovish stance by major central banks.

Meanwhile, the Reserve Bank of India (RBI) is expected to announce a 25-basis-point rate cut on Friday. Last week, the European Central Bank (ECB) lowered its Deposit Facility Rate by 25 basis points to 2.75%, while the People’s Bank of China (PBoC) has signaled potential rate cuts. Additionally, the Bank of Canada (BoC) has paused its quantitative tightening, and Sweden’s Riksbank has cut interest rates.

The price for Gold stood at 8,062.54 Indian Rupees (INR) per gram, up compared with the INR 8,029.32 it cost on Thursday.

The price for Gold increased to INR 94,049.27 per tola from INR 93,652.40 per tola a day earlier.

FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.

(An automation tool was used in creating this post.)

Silver prices have increased by 11.96% since the beginning of the year.

The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, stood at 88.70 on Friday, up from 88.55 on Thursday.

(An automation tool was used in creating this post.)

• Silver price moves higher to near $32.40 as bond yields trade cautiously ahead of the US NFP data for January.
• Investors expect the US economy to have added 170K workers last month.
• Upbeat US labor market data would force traders to raise bets supporting the Fed to keep interest rates steady for longer.

Silver price (XAG/USD) climbs to near $32.40 in European trading hours on Friday. The white metal gains as the US Dollar (USD) and bond yields tick lower ahead of the United States (US) Nonfarm Payrolls (NFP) data for January, which will be published at 13:30 GMT.

Investors will focus on employment data to gauge the Federal Reserve’s (Fed) monetary policy outlook. On Thursday, Dallas Fed Bank President Lorie Logan said she would support holding interest rates at their current levels until the “labor market doesn’t falter.”

The US NFP report is expected to show that 170K fresh workers were added to the labor force in January, fewer than 256K in December. The Unemployment Rate is estimated to have remained steady at 4.1%. Signs of strong labor demand would boost market expectations that the Fed will keep interest rates in their current range of 4.25%- 4.50% for longer. Such a scenario would be unfavorable for the Silver price.

Investors will also focus on the Average Hourly Earnings data, which is a key measure of wage growth. On year, the wage growth measure is expected to have decelerated to 3.8% from 3.9% in December.

Ahead of the US NFP, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades subduedly around 107.70. 10-year US Treasury yields tick lower to near 4.43%.

Silver technical analysis

Silver price strives to break above the immediate resistance of $32.50, which is plotted from the December 9 high. The outlook of the white metal remains bullish as the 20-day Exponential Moving Average (EMA) is sloping higher near $30.90.

The 14-day Relative Strength Index (RSI) oscillates in the 60.00-80.00 range, suggesting that the momentum is bullish.

Looking down, the upward-sloping trendline from the August 8 low of $26.45 will be the key support for the Silver price around $29.50. While, the October 31 high of $33.90 will be the key barrier.

Silver daily chart

• Silver retreats over 1% from $32.64 as rising US Treasury yields undermine gains.
• Technical outlook suggests consolidation possible between $31.00 and $32.60, with resistance at $33.00.
• Downward pressure may test support levels at $31.10 and $31.00, near critical moving averages.

Silver’s price retreats after hitting a weekly high of $32.64 and drops below the psychological figure of $32.00 after the release of mixed US jobs data. The jump in US Treasury bond yields and Greenback’s remaining bid were headwinds for the grey metal. Therefore, Silver (XAG/USD) trades at $31.82, with losses of over 1%.

XAG/USD Price Analysis: Technical outlook

Despite reaching a two-month high, XAG/USD seems poised to consolidate around $31.00 – $32.60 unless buyers drive prices above $33.00 a troy ounce. Momentum has shifted bearish in the short-term, as portrayed by the Relative Strength Index (RSI), but buyers are in charge as the RSI remains above its neutral line.

XAG/USD needs to surpass $33.00 for an extension of the uptrend. A breach of that level could propel prices to test the October 29 swing high of $34.54, ahead of challenging last year’s peak at $34.86.

On the flip side, a further downside is seen below the 100-day SMA at $31.10, followed by the $31.00 figure. Once those levels are cleared, the next support would be the 50-day SMA at $30.47, followed by the 200-day SMA at $30.27

XAG/USD Price Chart – Daily