Gold (XAUUSD), Silver, Platinum Forecasts – Gold Rebounds As Oil Drops

Gold Rebounds As Traders Buy The Dip

Gold rebounds as traders buy the dip amid geopolitical uncertainty. Recent reports indicated that Iran requested talks with the U.S. Iran denied these reports.

However, oil prices moved lower as traders bet that Iran would be forced to ask for negotiations, which would be a de-facto capitulation. Geopolitical risk premium declined, which was bearish for oil and U.S. dollar.

Ironically, gold, which is the traditional safe-haven asset, benefited from the decline in geopolitical premium. This may sound strange to someone who is new to markets.

It should be noted that almost any asset can play different roles, depending on market situation. In recent years, gold benefited from active central bank purchases. Central banks bought gold to diversify away from fiat currencies amid geopolitical tensions and sanctions wars.

These purchases attracted speculative investors and traders, who also played a material role in gold’s rally. Thus, the market has become structurally more leveraged than it was just several years ago.

Leveraged players are extremely sensitive to changes in global market sentiment and are often forced to react regardless of the fundamental attractiveness of their positions.

Yesterday’s sell in the gold markets was triggered by rising geopolitical premium, which forced leveraged players to cover their bets everywhere, including gold markets. Today, the global market situation has calmed down, which served as a bullish catalyst for gold.

From the technical point of view, gold is trying to settle back above the support level at $5100 – $5120. In case this attempt is successful, gold will move towards the resistance, which is located near recent highs at $5430 – $5450.

Silver Gains Ground Amid Rising Demand For Precious Metals

Silver gained ground as gold/silver ratio pulled back towards the 61.50 level. Traders bought the dip amid hopes that the conflict in the Middle East could end soon.

It should be noted that there are no signs indicating that the conflict is coming to an end. The recent reports which showed Iran tried to contact U.S. to seek negotiations could be false, as it often happens during military conflicts.

Silver made an attempt to settle above the resistance at $86.00 – $87.00 but lost momentum and pulled back. In case silver declines below the $82.00 level, it will head towards the support at $78.10 – $79.10.

On the upside, a move above the $87.00 level will push silver towards the next resistance, which is located in the $95.00 – $96.00 range.

Platinum Attempts To Settle Above $2150

Platinum has also managed to rebound as traders took some profits off the table after the strong pullback.

The duration of the conflict will remain the key catalyst for platinum markets in the upcoming weeks. In case the conflict ends soon, platinum will have a great chance to gain sustainable upside momentum.

If the war in the Middle East lasts for weeks while the Strait of Hormuz remains closed, global economy will find itself under pressure, and demand for platinum will decline.

In case platinum settles above the $2150 level, it will move towards the resistance at $2245 – $2265. On the support side, a successful test of the support at $2040 – $2060 will push platinum towards the support level at $1880 – $1900.

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