As we witness the dynamic fluctuations of precious metals, the recent performance of gold and silver has captured the attention of traders and investors alikeLast week, both metals exhibited a remarkable upward trend, reaching notable peaks but subsequently experiencing significant market shiftsGold soared as high as 2942, with silver touching 33.3. However, it is essential to approach these trends with caution and not get swept away by the immediate price surgesTrading strategies that prioritize dips over highs often prove to be more beneficial in navigating the volatile nature of these marketsFor those who adhered to this principle last week, they would have found themselves better positioned to capitalize on gains while minimizing exposure to wild market swingsIndeed, Friday saw a substantial market correction or “Black Friday,” as it is known, with gold plummeting to a low of 2878 and silver hitting 32, perfectly aligning with the forecasts of volatility.

The recent directives from the U.S. government have also stirred discussions surrounding inflation and its impact on precious metalsOn Thursday, the new administration instructed its economic team to outline plans for imposing tariffs on countries that currently tax U.S. importsThis could ignite inflationary pressures, which traditionally bolsters demand for gold as a safe-haven assetAmidst this backdrop, the latest retail sales report from the U.S. revealed a significant downturn, marking the steepest decline in nearly two yearsSuch data has intensified market speculation regarding the potential for Federal Reserve rate cuts, with traders betting on the earliest reduction occurring in SeptemberGiven that gold does not yield interest, a low-interest environment typically favors its price escalation.

As we embark on a new trading week, the dollar's continued decline raises questions about gold's current trajectory

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Analysts suggest that the dollar might breach its recent low of 105, leading to increased scrutiny over whether gold’s upward trend is intact or if a bearish sentiment is taking holdDespite the fluctuations, the consensus remains that gold maintains a bullish outlookThe recent high of 2942 before the Friday corrections indicates that, while the upward momentum is under pressure, it has not been definitively brokenThe economic landscape and geopolitical tensions do not currently warrant a shift in gold's status as a safe haven, leaving room for potential rebounds.

It is crucial to recognize, however, that following Friday's decline, gold may not exhibit the same robust strength observed earlierThe absence of immediate new highs raises uncertainty about surpassing the 2942 mark again shortlyWhile the broader trend remains bullish, it is likely that we will encounter a phase characterized by oscillation and upward movementsTraders are encouraged to adopt a momentum-following strategy as gold opens the week oscillating around 2883. Early indications provided buying opportunities as prices hit 2885 before experiencing an upturn towards 2995. Although some might have missed this initial surge, opportunities persist, particularly for those vigilant about market actions.

From a technical perspective, the daily charts indicate a significant bearish engulfing pattern, although Bollinger Bands suggest a tightening range without a definitive break of key moving averagesThe 5-day and 10-day averages have yet to reflect bearish tendencies, leaving open the possibility for a reboundShould the gold price maintain strength through the week, further upward movement past the 2942 resistance seems plausibleCurrent levels require close monitoring, with resistance noted at 2930 and 2942, while support resides at 2875 and 2830, with a further bearish target around 2800 if downward momentum persists.

Similar vigilance is warranted in the silver market, as last week saw prices reach a high of 33.1 before correcting to a low of 31.9. While breaking through the 32.5 mark briefly, silver demonstrated a volatility pattern indicative of market uncertainty

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