Spot gold and silver prices continued their modest gains in Tuesday’s quiet trading session, when US markets were closed for Independence Day. Gold remains in a downtrend. However, it adds value to our country. Analysts are waiting for near-term resistance levels to be tested after last week’s $1,900 per ounce support. Let’s look at the details.
Response of gold price to rising bond yields
There are cases where bond yields, especially 10-year bond yields, approach 4%. Accordingly, analysts state that gold and silver prices may remain under some pressure. Traders are wary of rising US yields. However, there is still hope for a potential peak in the uptrend of US yields. Accordingly, they are interested in entering the market below $1,900.
The weakening US dollar signals market expectations that the Federal Reserve is nearing the end of its aggressive tightening cycle. However, the expected axis of relaxation remains uncertain. Market expectations point to an interest rate hike in the near future. It also predicts higher levels throughout the second half of the year.
Effects of high interest rates on the yellow metal
Some analysts think that the gold price may be affected by long-term high interest rates. Daniel Pavilonis, a veteran commodities broker, suggests that gold prices may need to drop below $1,900 an ounce to gain attention again. Pavilonis also anticipates the possibility that gold prices will test support in the mid-to-high $1,700 range, indicating a potential market bottom.
Despite the increase in bond yields, the market continues to send recession warnings. The difference in the US 2-10 year yield curve, which has reached its highest level in the last 20 years, presents an interesting situation. Accordingly, it points to a negative course for the US economy. This seems to limit the ability and willingness of the Federal Open Market Committee to raise interest rates further to reduce inflation.
Understudy and opposing view
Gold remains in a downtrend, with support below $1,900 looking strong. It also opens up the possibility of an upward move to push the $1,931-1,936 resistance levels. Analysts are urging outliers to consider gold as an investment opportunity.
cryptocoin.com When we look at it as a whole, the price of silver is affected by some developments. It is benefiting from strong industrial demand, especially in the context of the transition to green energy and the growing need for solar energy. Analysts observe technical momentum increasing in silver. However, they emphasize that it is necessary to break above $23 per ounce to create new bullish momentum. When we look at the gram gold price, we see that it is traded at the level of 1.628 TL.
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