Gold Remains Stuck Near Resistance At $4160 – $4180
Gold pulls back as traders focus on the strong rally in the oil markets and react to rising Treasury yields.
Oil prices gained 3.5% as traders focused on rising tensions in the Middle East. From a big picture point of view, oil markets prepare for another round of war between U.S. and Iran. President Trump has recently said that he would not use nuclear against Iran but could use the “Mother of all Bombs”. There are no signs indicating that U.S. – Iran talks have any chance for success in the near term, so traders prepare for escalation. High oil prices boost inflation and may force the Fed to raise rates aggressively.
FedWatch Tool indicates that there is a 17.2% probability that Fed will raise rates at the next meeting in October. However, traders are convinced that the central bank will raise rates in December and January.
Treasury yields have started to rebound after yesterday’s strong pullback. The yield of 2-year Treasuries settled near the 4.75% level, while the yield of 10-year Treasuries climbed above the 5.10% level. Rising Treasury yields served as a negative catalyst for gold markets in today’s trading session.
U.S. dollar moved lower against a broad basket of currencies as pullback continued. Howeve, weaker dollar did not provide sufficient support to gold prices.
Gold continues its attempts to settle above the resistance level at $4160 – $4180. In case gold manages to settle above the $4180 level, it will head towards the next resistance, which is located in the $4300 – $4320 range. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.
Silver Pulls Back As Gold/Silver Ratio Rebounds
Silver moved lower as gold/silver ratio climbed towards the 73.00 level. In case gold/silver ratio settles above 73.00, it will head towards the 75.00 level, which will be bearish for silver.
Currently, silver is trying to settle back below the support at $56.00 – $57.00. In case this attempt is successful, silver will move towards the next support level at $51.00 – $52.00.
On the upside, silver needs to stay above the $57.00 level to have a chance to gain upside momentum in the near term. In this case, silver will head towards the resistance level at $61.00 – $62.00.
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See all Gold forecastsPlatinum Moves Away From Session Highs
Platinum was mostly flat as traders focused on the situation in the oil markets. Palladium markets were down by -1.7%, which was bearish for platinum.
From the technical point of view, platinum made an attempt to settle above the support level at $1600 – $1620 but lost momentum and pulled back. In case platinum declines below the $1600 level, it will head towards the next support level at $1520 – $1540.
On the upside, a move above the $1650 level will push platinum towards the resistance level at $1700 – $1720.
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