Metals dive lower from the global Hawkish repricings, Opportunity or Trap? – Silver (XAG/USD) and Gold (XAU/USD) Outlook

• Silver, Gold and the entire metals space have taken a beating since the FOMC
• The recent Fed Meeting turned things around with global Hawkish repricings
• Daily timeframe analysis for XAG/USD and XAU/USD

The arrival of Spring brought a significant shift in market dynamics as the ongoing conflict affected Market flows.

A series of Central Bank rate meetings has drastically changed the landscape. The US-Iran conflict has led to a rapid change in inflation expectations, primarily driven by increases in crude oil and related energy products.

Asian and European countries are finding it difficult to meet their commodity demands due to the effective closure of the Strait of Hormuz. Although the situation is gradually improving, uncertainty remains, and the concerns about inflation are very real. And Inflation is good for no one.

What has particularly impacted the metals market are the indirect effects stemming from such change in inflation.

Aside from a few exceptions, such as the Bank of Japan and the Reserve Bank of Australia, the consensus has been toward rate cuts and pauses. However, as inflation expectations rise, many Central Bank governors have begun to shift their stance towards hikes, which was highlighted in this week's press conferences.

And this is definitely not helping the case for higher prices in Metals.

Metals have fallen victim to their own success. At the beginning of the war, investors rightly questioned why these precious safe havens had not returned to their previous highs.

Historically, war creates strong demand for metals; they are not only needed for military equipment but are also sought after as a hedge against rising uncertainty in risk assets and general supply shocks.

However, this time is different. Markets did not experience a flight-to-safety trend during the war, as military operations did not escalate to the extent that would require such a shift. Instead, the largest concerns quickly shifted to the militarized rise in petroleum prices.

When market participants fail to see what they want to see, and the fundamentals shift unexpectedly, it can result in significant outflows from the metals asset class.

The last session intensified the pre-FOMC decline in gold, silver, and other precious metals, alongside equities and bonds.

The asset class now faces a potential major transformation compared to the strictly bullish trends seen at the end of 2024 and into 2025.

With this morning's shy attempt of a rebound, let's explore this shift in a daily timeframe analysis of Gold (XAU/USD) and Silver (XAG/USD) to identify if the previous session's drop provides an opportunity for late trend joiners, or a trap.

Read More:

• Chart alert: Watch 157.40 on USD/JPY, hawkish BoJ, ECB and BoE ignite yen strength
• Another chaotic post-FOMC session – North American Session Market Wrap for March 19
• The US Dollar dives after the FOMC, long-term reversal incoming? – Dollar Index (DXY) outlook

Gold had warned traders of its War time inability to reach its prior highs, returning to "only" $5,400 before correcting. But looking back, Bullion had also just reacted to the high of its long-term channel, which created its initial $3,500 top in June 2025.

Turning to today, the region to focus on is $4,400 to $4,500 Support Zone from February, serving as major barrier to further downside in the late January tumble.

The tricky part is the fact that yesterday's end-session rebound attempt is seeing a major rejection as we speak, with a bearish daily candle forming – Hinting at a retest of the past day's $4,502 lows, Bulls will want to see a rebound here.

• Failing to rebound would point at least to $4,395 (February spike lows).
• Below will only find support around $4,100, then $3,500.

Higher Timeframe Levels to watch for Gold (XAU/USD):

Resistance Levels:

• February Wick Pivot $4,675
• $4,850 to $4,900 Key Support now Resistance
• $5,100 Pivotal Resistance
• Current All-time Highs – $5,500 to $5,600
• Key Fibonacci Projection $5,800 to $5,900
• $5,400 mini-resistance

Support Levels:

• Past session lows $4,500
• Pivotal Support $4,400 to $4,500 – Bullish above, Bearish below
• February lows $4,395
• Main Channel Lows Support $4,100
• $3,200 to $3,500 Major Support

Silver took a significant turn lower since breaking its $84 Major War Pivot, now resistance.

The price action has remained decisively bearish since falling below its 50-Day Moving Average, and failing to rebound from its past day spike, will now test its $64 February lows – The current bearish price action and RSI are not suggesting any rebound for now, but still, keep an eye on the key level.

Any break of such would then point to $55 to $57 (200-Day MA) which could be a strong dip-buying entry for the metal.

Higher Timeframe Levels to watch for Silver (XAG/USD):

Resistance Levels:

• Key Momentum Pivot $74 to $77.50
• Major Resistance $84.50 (50-Day MA)
• Higher Timeframe and War Resistance $90 to $95
• Current Record $121.67

Support Levels:

• December FOMC Minor Support $64 to $68 (testing)
• $64 February lows
• $55 to $57 October Resistance and 200-Day MA
• Silver's 2011 All-time highs $49.81

Safe Trades!

Follow Elior on Twitter/X for Additional Market News, interactions and Insights @EliorManier