Yang Jinrui: Is the recent fluctuation in gold and silver a shakeout before a rise or fall? Today's trend analysis and trading suggestions

Market Interpretation:

On March 24, against the backdrop of escalating geopolitical conflicts in the Middle East, gold, as a traditional safe-haven asset, should have shone brightly under the shadow of war. However, the market on Monday (March 23) staged a jaw-dropping drama. Due to Trump issuing a 48-hour ultimatum regarding Iranian energy over the weekend, market panic was ignited instantly, leading to a surge in international oil prices, a sharp rise in inflation expectations, a bleak outlook for Federal Reserve rate cuts, and a strong rally in the dollar index. Consequently, spot gold suffered a heavy blow, plunging more than 8.7% at one point, hitting a low of around $4,099 per ounce, approaching the support of the 200-day moving average, setting a four-month low, and marking its ninth consecutive trading day of decline, recording the worst weekly performance since 1983.

However, just as investors were nearly in despair, Trump suddenly posted on social media, announcing a “productive” dialogue with Iran. This news doused the flames of the oil market like cold water, causing oil prices to plummet over 10%, the dollar index to quickly retreat, and gold prices to stage a dramatic rebound, significantly narrowing the losses. The “deep V” movement of gold perfectly illustrates its dual nature in the current macroeconomic environment. For gold, although it has temporarily escaped the abyss of a “four-month low,” the road ahead remains clouded with uncertainty. Whether it can truly build a bottom and rebound depends on whether this Middle Eastern crisis leads to genuine easing or merely lingers briefly in the eye of the storm.

In-Depth Analysis of Gold Market Trends:

Gold: Highs followed by lows, weak trend unchanged. On Monday, we saw gold prices initially suppressed before rising, reaching a low of $4,099 and then rebounding to $4,513. Sounds pretty strong, right? But what happened next? By midnight, prices again fluctuated downwards, closing around $4,360. There’s a key point everyone should remember: the short-term rebound does not indicate a reversal. Currently, both the dollar and oil are still at high levels, and without substantial resolution to the energy issue, gold’s safe-haven properties are hard to truly activate. Therefore, the current rise is more of a technical recovery after being oversold, not a trend reversal.

From a technical perspective, although a long lower shadow hammer candlestick has formed, suggesting some support, the daily chart has not yet firmly closed with a bullish candle, and the Bollinger Bands have not contracted. This indicates that the low of $4,100 cannot yet be definitively labeled as a “major bottom.” Future movements will need to be monitored closely in relation to geopolitical situations. In the short term, $4,513 has already formed a short-term resistance level. The moving averages are diverging downwards, indicating a continuing bearish trend. Yang Jinrui believes that the probability of maintaining this weak rhythm today is high, with $4,500 acting as strong resistance above, while the initial support is at $4,200. If this level cannot hold, there is a possibility of testing or even breaking the $4,100 low again. In terms of trading, do not chase highs; go with the trend.

In-Depth Analysis of Silver Market Trends:

Silver: Following gold down, bottom to be confirmed. Silver is essentially the “shadow market” of gold. It rebounded from around $61, hitting a high of $71, an increase of nearly $1, quite a strong move, but then faced resistance at $71 and fell back, closing around $67.5. Clearly, silver is also currently in a mid-term weak state. There are no clear bottoming signals yet, and there is still room for further decline in the short term. The initial support level to watch is $63. As for whether $61 is the endpoint of this adjustment, that remains uncertain. It’s still a matter of watching the broader environment. Be patient and wait for signals; do not rush to bottom-fish.

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Editor: Chen Ping