Gold (XAUUSD), Silver, Platinum Forecasts – Gold Rallied Above $5000 As Dollar Pulled Back

Gold Climbs As China Tells Banks To Cut Their Exposure To Treasuries

Gold is moving higher as traders focus on U.S. dollar’s strong pullback. The American currency found itself under strong pressure as China urged its banks to cut their exposure to U.S. Treasury securuties.

According to recent reports, China is worried about potential volatility but does not have concerns about U.S. creditworthiness. Earlier, a Danish pension fund decided to sell its holdings of Treasuries amid concerns about U.S. ability to pay its debts. While the decision could have been politically motivated amid Greenland dispute, the move raised worries that other funds will follow suit.

The dollar’s weakness and worries about U.S. finances serve as positive catalysts for gold and other precious metals. Treasuries used to serve as a safe-haven asset, but safe-haven demand has shifted to gold and other metals.

Gold is moving towards the nearest resistance level, which is located in the $5100 – $5120 range. In case gold climbs above the $5120 level, it will head towards the next resistance at $5430 – $5450.

It should be noted that a successful test of the resistance at $5100 – $5120 will likely attract specutive buyers who were scared by the recent pullback and provide gold with an opportunity to climb towards historic highs.

Silver Tests New Highs As Rebound Continues

Silver rallied above the $80.00 level as gold/silver ratio declined towards the 61.00 level. Huge swings in gold/silver ratio have been responsible for silver’s volatility in recent trading sessions.

Gold/silver ratio touched multi-year lows near 43.50 on January 26 and tested the 72.00 level on February 6. Leveraged bets and subsequent margin calls were responsible for recent trading action in silver markets.

Traders used the strong sell-off from historic highs as an opportunity to increase their long positions at attractive levels. Last Friday, traders had a chance to buy silver near the $64.00 level, which was almost a 50% discount from the highs that were reached on January 26.

Volatility makes it hard to build longer-term positions, but traders are forced to make fast decisions as silver prices change fast. Perhaps, the market would benefit from a consolidation, but there are no signs indicating that silver prices are ready to stabilize within a reasonable price range.

From the technical point of view, silver moved above the resistance at $78.00 – $79.00 and is trying to settle above the $83.00 level. In case this attempt is successful, silver will head towards the next resistance, which is located in the $87.00 – $88.00 range. RSI remains in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

Platinum Tests Resistance At $2040 – $2060

Platinum is swinging between gains and losses despite U.S. dollar’s pullback. The market continues to consolidate after recent volatility.

Palladium markets climbed above the $1700 level as traders increased their long positions after the recent pullback. Rising palladium markets typically provide support to platinum prices.

Traders may prefer to wait for the  Non Farm Payrolls report, which will be released on Wednesday, before making decisive moves. Platinum is heavily dependent on industrial demand, so general economic situation serves as a bigger catalyst compared to gold markets.

Platinum is trying to settle above the nearest resistance at $2040 – $2060. In case this attempt is successful, platinum will move towards the 50 MA at $2126. A move above the 50 MA will open the way to the test of the resistance level at $2245 – $2265.

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