Gold (XAUUSD), Silver, Platinum Forecasts – Gold Retreats As Traders Focus On Fed Policy Outlook

Gold Retreats As Traders Bet On Hawkish Fed

Gold is losing ground as traders prepare for Fed Interest Rate Decision, which will be released tomorrow.

FedWatch Tool indicates that there is a 28.3% chance that Fed will raise rates tomorrow. The probability of a rate hike in September is estimated at 55.9%, while the probability of two rate hikes by September is estimated at 19.8%. Hawkish Fed policy outlook serves as the key bearish catalyst for gold markets. High interest rates are bearish for gold that pays no interest.

Treasury yields moved lower as bond traders focused on the sell-off in the oil markets. The yield of 2-year Treasuries pulled back towards the 4.27% level, while the yield of 10-year Treasuries settled near 4.60%. Falling Treasury yields did not provide support to gold markets as traders focused on longer-term Fed policy outlook.

U.S. dollar pulled back against a broad basket of currencies as forex traders reacted to the pullback in Treasury yields. Weaker U.S. dollar is bullish for dollar-denominated commodities, but it did not provide support to gold markets in today’s trading session.

Currently, gold is trying to settle below the support level at $4020 – $4040. In case this attempt is successful, gold will head towards the next support, which is located in the $3930 – $3950 range. A move below the $3930 level will indicate that gold is ready to gain additional downside momentum.

On the upside, a move above the $4100 level will push gold towards the resistance level at $4180 – $4200.

Silver Is Under Pressure As Gold/Silver Ratio Moves Above 70.50

Silver pulled back as gold/silver ratio moved above the 70.50 level. If gold/silver ratio stays above 70.50, it will head towards the 72.50 level, which will be bearish for silver.

The nearest support level for silver is located in the $56.00 – $57.00 range. A successful test of this level will push silver towards the next support at $51.00 – $52.00.

On the upside, silver needs to settle above the resistance level at $61.00 – $62.00 to gain sustainable upside momentum in the near term. In this case, silver will move towards the 50 MA at $64.72.

Platinum Remains Stuck Near The $1600 Level

Platinum moved lower amid broad pullback in precious metals markets. Palladium markets were down by -1.7% today, putting additional pressure on platinum. Interestingly, the strong pullback in the oil markets did not provide any support to platinum in today’s trading session.

The technical picture remains unchanged as platinum is stuck near the support level at $1600 – $1620. In case platinum settles below the $1600 level, it will head towards the $1550 level. A move below $1550 will open the way to the test of the next support, which is located in the $1500 – $1520 range.

On the upside, a move above the $1620 level will push platinum towards the resistance level at $1680 – $1700. RSI is in the moderate territory, so there is plenty of room to gain additional upside momentum in case the right catalysts emerge.

If you’d like to know more about how to trade gold and silver, please visit our educational area.