Spot gold and silver prices weakened in early U.S. trading on Tuesday as traders took profits following gold's two-month high overnight, with markets shifting into inflation-watch mode ahead of Wednesday's U.S. Consumer Price Index report, according to Kitco NewsWire. At the time of reporting, spot gold was trading near $4,386.30 per ounce, down 0.04% on the session, while spot silver was trading at $65.090, down 0.78%.
The market is positioning itself ahead of Wednesday's CPI release at 8:30 a.m. ET, with expectations for annual inflation to ease to 3.4% from the previous 3.5%. Market positioning remains caught between conflicting signals.
July payrolls declined by 23,000, suggesting labor market weakness, yet oil's recent rebound has pushed September Federal Reserve rate-hike odds back to 51.9%, up from the low-40% area seen earlier. The 10-year Treasury yield is trading near 4.74%, close to its highest level since January 2025, while the dollar index is flat near 99.834. Geopolitical tensions continue to influence commodity prices.
The Strait of Hormuz remains a key factor for metals and energy markets, with Iran linking any full reopening of the strait to U.S. concessions, while Washington has added new compensation demands that complicate negotiations. Brent crude briefly traded above $90 per barrel on Tuesday before easing, while U.S. crude held near the $82 area. These developments create a dual impact on gold: Hormuz risk supports safe-haven demand, but higher crude prices maintain inflation pressure and make it more difficult for traders to fully discount another potential Fed rate hike.
Additional Middle East shipping risk emerged when a small cargo ship was attacked in the Bab el-Mandeb Strait in the Red Sea, according to maritime security sources. Global equity markets displayed mixed signals. U.S. stock-index futures showed modest movement, with S&P 500 futures up 0.1%, Nasdaq futures up 0.3%, and Dow futures down 0.1%.
European indices were largely flat, with France's CAC 40 down 0.1%, Germany's DAX up 0.1%, and the FTSE 100 unchanged. Asian markets showed varied performance, with South Korea's Kospi gaining 0.7%, Hong Kong's Hang Seng down 1.1%, Shanghai Composite down 0.8%, and Australia's S&P/ASX 200 up 0.2%. In related markets, Nymex WTI crude oil was trading around $82.19 per barrel, with Brent crude near $87.61.
The benchmark 10-year U.S. Treasury note yield remained near 4.7%. From a technical perspective, gold bulls' next upside price objective is to push prices back above the $4,430.00 to $4,492.00 resistance zone, with sustained moves potentially targeting $4,500.00 and then $4,598.48.
Bears' near-term downside objective is a break below $4,360.00, with deeper targets at $4,299.00 and $4,224.00. For silver, bulls are targeting a move back above the $65.21 to $66.27 range, potentially targeting $67.60 and then $68.92. The bears' next downside objective is a break below $64.00, with deeper targets at $63.16 and $61.64.
Source: Kitco NewsWire
Source: kitco.com