2025-12-12 Sing Pao's Column《真金白銀》(English translation) Fed Rate Cut Triggers a Sharp Rally in Gold and Silver

Fed Rate Cut Triggers a Sharp Rally in Gold and Silver

The Federal Reserve delivered a widely anticipated 25‑basis‑point rate cut, lowering the federal funds target range to 3.50%–3.75%. Following the announcement, the U.S. Dollar Index plunged to 98.6, a one‑month low, while the 10‑year Treasury yield tumbled 0.88 percentage points to 4.19%, marking its largest single‑day decline in nearly six weeks. The sharp pullback in yields and the dollar immediately fueled a strong rally in precious metals, with both gold and silver surging higher.

Fed Chair Jerome Powell stated that current policy levels are appropriate for navigating upcoming economic conditions but declined to comment on whether further near‑term cuts are likely. Analysts note that while Powell remained cautious, markets continue to price in additional easing ahead—an important factor supporting the gold market.

Gold Technical Analysis

On the 4‑hour chart, the 20‑period simple moving average (SMA) remains above the 100‑period SMA, while longer‑term moving averages are gradually turning higher, signaling renewed bullish control. Gold is trading slightly above the short‑term moving averages, maintaining a constructive tone. However, technical indicators suggest momentum remains capped:• The momentum oscillator stays below zero and is trending lower.• RSI stands at 53, showing no clear directional bias yet.

Immediate resistance lies between USD 4,268 and USD 4,278. A confirmed breakout may open the path toward the USD 4,300 round‑number level. On the downside, support sits at USD 4,190—the price zone where gold began surging after the FOMC meeting. A break below this level may push gold back into a consolidation phase.

Silver Technical Analysis

Silver extended its strong rally and reached a new all‑time high of USD 62.88. The decisive breakout above the monthly range at USD 58.80 has triggered a fresh bullish wave across the market.However, the 4‑hour RSI has climbed to 78, indicating extreme overbought conditions in the short term.

A corrective pullback toward USD 60.30–60.20 could attract renewed buying interest, with the USD 60.00 psychological level offering support. A firm break below that threshold may prompt profit‑taking from recent long positions. Major U.S. banks have already lifted their 2026 silver price target to USD 65 per ounce, underscoring the growing attention on this rally.

Cryptocurrency Market

Crypto assets rallied ahead of the FOMC, with Bitcoin briefly reclaiming USD 94,500 and Ethereum approaching USD 3,400.Yet once the widely expected rate cut materialized, it lost its market‑moving power. Financial markets trade on expectations—not on the event itself but on what comes next.

Following the FOMC confirmation, major cryptocurrencies eased slightly. Looking forward, the key debate revolves around how long the easing cycle will last, how many cuts may come in 2026, and how the Fed's stance evolves—factors that will ultimately shape the next major trend in digital assets.

📌 Disclaimer

The content of this column is for informational purposes only and does not constitute investment advice or a solicitation to buy or sell any financial product. Investments involve risks, and markets may fluctuate. Readers should evaluate their financial situation carefully and seek independent professional advice before making investment decisions.