Peace before the next step? Metals at critical decision points

Today’s session feels like a classic “prove it” moment.

Across the dollar and precious metals, many markets are pushing straight to key support and resistance areas, but none of them have produced any decisive breakthrough yet. And that makes today’s daily close especially important.

US Dollar Index (DX.F)

The first thing that stands out from the daily chart is Friday’s fresh bearish pattern. This is an important development as it adds even more weight to the already strong resistance zone formed around the upper boundary of last Wednesday’s bearish gap and orange consolidation.

Today’s Asian session started A small bullish gap between 97.82 and 97.87. That gap gave the bulls reason to fight back after several failed attempts by the bears to break the key support zone.

And for a moment, it worked. The dollar is back above the 98 level, but the path higher is still unclear.

Last week’s bearish gap between 98.20 and 98.31 remains active, and the bearish island reversal still hangs like a ceiling on the charts. Together, these technological barriers continue to block the path to the answer.

That’s why, in our view, the bulls still have a major job to do. They need to break out of the orange consolidation, close the day above 98.31, and neutralize the bearish stance.

If they can overcome this, the door opens for a move towards the next major resistance zone between 98.75 and 99.68. Until that happens, the picture will remain mixed and this is one of those situations where patience is likely to be more valuable than prediction.

Silver (SI.F)

Let’s start this section with a quote from May 7:

“(…) If the bulls manage to end the day above 8000 and successfully close that gap, they will have a strong technical argument for another push towards the lower boundary of the former channel.

(…) If buyers manage to recapture that structure and break through the resistance cluster, the next target could emerge very quickly: the gap between 8850 and 8959 on March 11. (…)”

We look at it from today’s perspective Silver has followed the bullish script almost completely (and first of all – Congratulations to everyone who used that scenario to add to their profits!).

Yesterday, the bulls closed not only above the gap zone of April 20 and March 13, but also above the previously broken lower boundary of the Green Rising Channel. That move invalidated the earlier breakdown below the channel, which is a very positive technical sign.

That show of strength led to an open higher in Asia, and the newly created bullish gap encouraged another rise towards the last resistance zone before the psychologically important 9000 level.

As the chart shows, however, the combination of two Fibonacci retracements and the lower edge of the March 11 gap (8850-8959) slowed the rally and triggered a pullback, bringing the price back to the previously achieved lower boundary of the ascending channel.

But for now, the bigger picture remains constructive.

In our opinion, unless we see a daily close below that support line and especially below 8526 – buyers still have a solid chance to launch another attack on the nearby resistance zone.

What would invalidate this bullish scenario?

Daily closing below 8526. If this happens, the first downside target for the bears will probably be the 8000-8120 zone.

gold(gc.f) & Platinum (Pl.F) and Palladium (Pa.F) → These sections (+today’s takeaways + main level for viewing) are reserved for premium reader Today.

Today’s takeaways and key levels to watch

For dollars:

• Watch Bearish Gap 98.20-98.31 With Island Reversal Overhead
• Daily close above 98.31 will open towards 98.75-99.68
• Failure to break resistance -> keeps the dollar stuck in consolidation
• Continued weakness in dollar may remain supportive for metals

For silver:

• Look at the reclaimed lower boundary of the green rising channel (key support)
• Resistance is in the 8850-8959 area
• Successful breakout -> could pave the way towards 9000 barrier
• Daily close below 8526 -> Open downside risk towards 8000-8120
• Silver remains one of the strongest charts in the group.

Respect the levels, ignore the noise and let the market come to you.
Anna