Gold Attempts To Settle Below $4150
Gold is losing ground despite weaker dollar. U.S. dollar pulled back against a broad basket of currencies as forex traders took some profits off the table near yearly highs. Weaker dollar is bullish for dollar-denominated commodities, including gold.
Treasury yields were mixed in today’s trading session. The yield of 2-year Treasuries moved above the 4.81% level as traders bet that Fed will be forced to raise rates to fight inflation. That said, FedWatch Tool indicates that there is a 23.8% probability of a rate hike at the next meeting in October. The market expects that Fed will raise rates in December.
Interestingly, longer-dated bonds have finally started to attract investors. The yield of 10-year Treasuries pulled back towards the 5.22% level, while the yield of 30-year Treasuries declined below 5.58%. Gold traders focused on dynamics of shorter-term yields and ignored recent developments in long-dated bond markets.
Oil prices gained some ground as traders focused on escalation in the Middle East. President Trump said that Houthis were “behaving very badly” and accused them of trying to drive up oil prices. I’d note that oil markets did not rally after Trump’s words, which was surprising as Trump’s post signaled that U.S. could put pressure on the Houthis.
From the technical point of view, gold made an attempt to settle above the resistance level at $4160 – $4180 but lost momentum and pulled back towards the $4150 level. In case gold settles below $4160, it will head towards the $4100 level. A move below $4100 will open the way to the test of the support at $4000 – $4020.
Silver Retreats As Gold/Silver Ratio Moves Above 70
Silver pulled back as gold/silver ratio climbed above the psychologically important 70.00 level. If gold/silver ratio settles above 70.00, it will head towards the 72.00 level, which will be bearish for silver.
Currently, silver is trying to settle below the $59.00 level. In case this attempt is successful, silver will move towards the nearest support, which is located in the $56.00 – $57.00 range.
A move below the $56.00 level will provide silver with a chance to gain additional downside momentum. In this case, silver will head towards the $52.00 level. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.
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See all Gold forecastsPlatinum Is Under Strong Pressure
Platinum is losing ground amid broad pullback in precious metals markets. Palladium markets are down by -1.3%, which is bearish for platinum.
Platinum failed to settle above the resistance at $1700 – $1720 and declined towards the $1650 level. In case platinum settles below $1650, it will head towards the nearest support, which is located in the $1600 – $1620 range. A successful test of this level will open the way to the test of the $1520 level.
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