(Kitco NewsWire) - Spot gold prices are higher and spot silver prices outperformed in late Monday trading, as a weaker U.S. dollar, lower Treasury-yield expectations and a sharp drop in crude oil prices supported precious metals. At the time of writing, spot gold was trading near $4,569.30 an ounce, up 1.35%, while spot silver was trading near $77.95, up 3.38% on the session.
U.S. cash equity and bond markets were closed for Memorial Day, and the U.S. economic calendar had no scheduled releases. The next U.S. data focus is Tuesday’s March S&P/Case-Shiller home price index at 9 a.m. ET and May consumer confidence at 10 a.m. ET, followed later in the week by Richmond Fed manufacturing, personal income and spending, durable goods, second-estimate first-quarter GDP, new home sales, wholesale inventories and Chicago PMI.
The Strait of Hormuz remains the central geopolitical transmission channel into energy, inflation expectations and precious metals, but Monday’s market traded the possibility of de-escalation rather than fresh disruption. Oil fell to two-week lows on optimism that the U.S. and Iran are moving toward a peace agreement that could reopen the strait, with Brent dropping below $100 and U.S. crude falling toward the low-$90s. The move is supportive for gold and silver through lower energy-inflation risk, a softer dollar and lower implied rate pressure, even as a successful deal would reduce some safe-haven demand. Across other markets, the clearest impact is lower crude, stronger global equities, softer dollar pricing and a relief bid in rate-sensitive assets.
Global equities were firmer while U.S. cash markets were closed. Japan’s Nikkei 225 rose nearly 3%, Europe’s Stoxx 600 gained about 1% and U.S. futures also rose as traders priced a lower oil-inflation shock, while the dollar slipped against major currencies.
The key outside markets see Nymex WTI crude oil prices sharply lower and trading around $91.00 a barrel, while Brent crude was near $97.40. The U.S. dollar index is softer. The yield on the benchmark 10-year U.S. Treasury note is not trading in the U.S. cash session because the bond market is closed for Memorial Day.
Technically, spot gold bulls’ next upside price objective is to push prices back above the $4,580.80 to $4,660 resistance zone, with a sustained move targeting $4,678 and then $4,800. Bears’ next near-term downside price objective is a break below $4,533.90, with deeper downside targets at $4,500 and then $4,380. First resistance is seen at $4,580.80 and then at $4,660. First support is seen at $4,533.90 and then at $4,500.
Spot silver bulls’ next upside price objective is to drive prices back above the $78.95 to $89.00 area, with a move above that zone targeting $90.00 and then $100.00. The next downside price objective for the bears is a break below $76.40, with deeper downside targets at $72.00 and then $70.00. First resistance is seen at $78.95 and then at $89.00. Next support is seen at $76.40 and then at $72.00.
