Gold climbed back above $4,100 as oil prices fell 4% on Middle East developments, dragging Treasury yields lower and the dollar with them. Silver tested $60.00 and platinum pushed toward $1,600 as demand for precious metals broadened.
Gold rebounded above the $4,100 level as traders fixed on a sharp pullback in the oil market. Oil prices dropped 4% as traders reacted to recent events in the Middle East, and that move rippled straight into the metals complex.
Middle East supply and diplomacy shift the backdrop
Iran sent oil tankers carrying 11 million barrels of crude through the Strait of Hormuz, rushing to sell after the U.S. continued to attack targets in Iran but stopped short of a naval blockade of its ports. Iran has also attacked targets in the region in response to those U.S. strikes, which followed Iran's earlier attacks on vessels in the Strait of Hormuz.
Meanwhile, Qatar and Pakistan appear ready to return to their roles as mediators to facilitate negotiations between the U.S. and Iran, according to recent reports. That prospect helped ease the oil bid that had lifted prices.
Falling yields and a softer dollar lift gold
Lower oil prices supported gold as Treasury yields fell. The yield on 2-year Treasuries declined toward 4.16%, while the 10-year yield settled near 4.53%, and lower yields tend to favor gold because it pays no interest. The U.S. dollar pulled back against a broad basket of currencies as traders focused on the retreating yields, giving the metal a second tailwind.
The nearest resistance for gold sits in the $4,180–$4,200 range; a clean break there opens the path toward the next level at $4,360–$4,380.
Silver and platinum ride the same wave
Silver rallied as the gold/silver ratio pulled back toward 68.50, a move that shows up when risk appetite is rising. The metal is now trying to settle above resistance at $61.00–$62.00; a push above $62.00 would target $65.00–$66.00, while a drop below $60.00 exposes support at $56.00–$57.00.
Platinum also gained ground amid rising demand for precious metals, helped as palladium climbed 2.6%. It is attempting to settle above resistance at $1,600–$1,620, with the next zone at $1,680–$1,700; a slip back below $1,560 would open the way to support at $1,500–$1,520.
Source: FXEmpire
Trading involves risk.
Risk Disclaimer
