Gold Pulls Back As Traders Worry About Hawkish Fed
Gold is losing ground as traders focus on stronger dollar and prepare for another potential rate hike from the Fed.
FedWatch Tool indicates that there is a 53.1% probability that Fed will raise the federal funds rate at the next meeting in October. The probability of two rate hikes by the end of the year is estimated at 42.4%.
Interestingly, Treasury yields are moving lower in today’s trading session. The bond market has calmed down, and some traders are ready to buy U.S. bonds, betting that Fed will control inflation. The yield of 2-year Treasuries declined towards the 4.75% level, while the yield of 10-year Treasuries pulled back towards the 4.96% level. I’d note that the pullback in Treasury yields did not provide any support to gold markets in today’s trading session.
U.S. dollar moved higher against a broad basket of currencies as traders ignored the pullback in Treasury yields and focused on hawkish Fed policy outlook. Stronger dollar put pressure on gold markets today.
The nearest support level for gold is located in the $4300 – $4320 range. If gold pulls back below the $4300 level, it will head towards recent lows near the $4250 level. A move below $4250 will open the way to the test of the support at $4160 – $4180.
On the upside, gold needs to climb above the $4400 level to have a chance to gain upside momentum in the near term. In this case, gold will head towards the resistance at $4480 – $4500.
Silver Is Losing Ground As Traders Take Profits After The Strong Rebound
Silver moved away from recent highs as traders took some profits off the table after the strong rebound. Gold/silver ratio pulled back below the 66.00 level, but this move did not provide sufficient support to silver markets.
In case silver pulls back below the $65.00 level, it will head towards the 50 MA at $63.13. A move below the 50 MA will push silver towards the support level at $61.00 – $62.00.
On the upside, a move above the $68.00 level will open the way to the test of the psychologically important $70.00 level. If silver climbs above $70.00, it will head towards the resistance level at $71.00 – $72.00.
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See all Gold forecastsPlatinum Attempts To Settle Back Below $1800
Platinum moved away from session highs amid pullback in precious metals markets. Palladium markets were up by +0.2%, which was neutral for platinum.
The strong pullback in the oil markets did not provide sufficient support to platinum in today’s trading session. WTI oil pulled back towards the $95.00 level, while Brent oil made an attempt to settle below the $100.00 level.
If platinum declines below the $1780 level, it will move towards the 50 MA at $1734. A move below the 50 MA will open the way to the test of the support level at $1700 – $1720.
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