Gold (XAUUSD), Silver, Platinum Forecasts – Gold Dives 3% As Traders Bet On Hawkish Fed

Gold Retreats After Strong NFP Report

Gold tests new lows as traders react to the Non Farm Payrolls report. The report showed that the U.S. economy added 172,000 jobs in May, exceeding the analyst forecast of 85,000.

The report indicated that the U.S. job market remained in great shape despite high oil prices, which means that Fed will start raising rates to curb inflation. The yield of 2-year Treasuries climbed towards the 4.15% level, while the yield of 10-year Treasuries settled above 4.52% as bond traders bet on hawkish Fed.

Expectations of the start of the new rate hike cycle put significant pressure on gold that pays no interest.

U.S. dollar gained ground against a broad basket of currencies as traders focused on rising Treasury yields. Strong dollar is bearish for gold and other dollar-denominated commodities as it makes them more expensive for buyers who have other currencies.

In current conditions, strong dollar presents an additional problem for gold markets. Many currencies have found themselves under material pressure amid high oil prices. Central banks may be forced to sell gold from reserves to provide some support to local currencies, putting additional pressure on gold markets.

Currently, gold is trying to settle below the support level at $4350 – $4370. In case this attempt is successful, gold will head towards the next support, which is located in the $4180 – $4200 range. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

Silver Dives As Traders Focus On Fed Policy Outlook

Silver is under strong pressure as gold/silver ratio jumped above the 62.50 level. In case gold/silver ratio stays above the 50 MA at 60.82, it will move towards the 65 level, which will be bearish for silver.

From a big picture point of view, global appetite for risk declined, which served as a significant bearish catalyst for silver markets.

Silver declined below the support at $71.00 – $72.00 and is trying to settle below the $69.00 level. In case this attempt is successful, silver will move towards the next support, which is located in the $65.00 – $66.00 range. A move below the $65.00 level will open the way to the test of the $61.00 level.

On the upside, silver needs to climb back above the 50 MA at $76.17 to have a chance to gain sustainable upside momentum in the near term.

Platinum Tests Support At $1780 – $1800

Platinum tested new lows amid broad pullback in precious metals markets, which was triggered by rising Treasury yields. Palladium markets are down by -5%, putting additional pressure on platinum.

From the technical point of view, platinum attempts to settle below the support at $1780 – $1800. In case this attempt is successful, platinum will move towards the next support level at $1680 – $1700.

On the upside, a move above the resistance level at $1880 – $1900 will push platinum prices towards the 50 MA at $1977. Most likely, platinum will need significant catalysts to break the current trend.

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