Gold and silver have come under increased pressure in the last two weeks. Silver has ten sessions of backtoback decline, from 25 to 22.5, and is back near the lower end of its trading range since July 2020.

In the middle of last month, the pressure on gold intensified after a failed attempt to climb above 2000.

There was a similar disappointment for the bulls in silver when they failed once again to consolidate the price above the meaningful 25 round level.

The US dollar has strengthened by 5.8 since April, contributing significantly to the base appreciation in metals and other commodities.

In our view, gold and silver might continue their downward trend until FOMC comments or until the monthly labour market report.

The potentially important support is around 1835, the 200 SMA. The performance of gold near that mark could lay the foundations for a prolonged trend, whether it is a reversal to the upside or a final capitulation of the buyers.

For silver, the following potential support line looks at 22.

A sharp drop from 1830 in gold or below 22 in silver would confirm a breakup of the established ranges and promises to be the harbinger of an even more furious and prolonged decline.

In a pessimistic scenario, the gold price could retreat below 1500 by the end of the third quarter and to 16 in silver.

But suppose the Fed comments return demand for risk. In that case, the momentum in the precious metals could renew and give an informal start to the rally to update…