Gold (XAUUSD), Silver, Platinum Forecasts – Gold Tests New Lows As Oil Prices Soar

Gold Remains Under Strong Pressure

Gold tests new lows as traders focus on the strong rally in the oil markets. Oil prices are up by more than 7% as traders worry about additional escalation in the Middle East. Negotiations between U.S. and Iran have stalled.

U.S. President Trump rejected Iran’s proposal, and it remains to be seen whether Iran will come up with a new one. From a big picture point of view, global markets are worried that the war will restart and the Strait of Hormuz would be closed for months.

Rising oil prices put significant pressure on risk assets. Gold continues to trade as a risk asset as its previous rally attracted speculative players. Traders should also note that some central banks may sell gold to provide support to local currencies, putting additional pressure on gold markets.

Traders also focus on Fed decision, which will be released soon. Fed is expected to keep rates unchanged, and traders will likely focus on Powell’s comments. It remains to be seen whether Powell’s comments will have a major impact on gold price dynamics as his term as Fed Chair ends in May.

Treasury yields gained strong upside momentum ahead of Fed decision. Importantly, the yield of 30-year Treasuries made an attempt to settle above the psychologically important 5.00% level. A move above the 5.00% level may send shockwaves across markets. Rising Treasury yields are bearish for gold that pays no interest.

U.S. dollar gained ground against a broad basket of currencies, supported by rising yields and geopolitical risks. Strong dollar put additional pressure on gold markets in today’s trading session.

Currently, gold attempts to settle below the support at $4530 – $4550. In case this attempt is successful, gold will move towards the next support, which is located in the $4350 – $4370 range.

Silver Retreats Ahead Of Fed Decision

Silver is under pressure as gold/silver ratio climbed above the 63.50 level. It should be noted that gold/silver ratio continues to move higher, which is bearish for silver markets.

From the technical point of view, silver is trying to settle below the support level at $71.00 – $72.00. If silver manages to settle below the $71.00 level, it will head towards the next support, which is located in the $65.00 – $66.00 range. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

On the upside, silver needs to settle back above the $75.00 level to gain upside momentum in the near term. A move above the $75.00 level will push silver towards the resistance level at $78.00 – $79.00.

Platinum Tests Support At $1880 – $1900

Platinum moved lower amid broad pullback in precious metals markets. Palladium markets were down by 2.5%, putting additional pressure on platinum.

A successful test of the support at $1880 – $1900 will push platinum towards the next support at $1780 – $1800. If platinum declines below the $1780 level, it will gain additional downside momentum and move towards the $1700 level.

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