(Kitco NewsWire) - Spot gold and silver prices are sharply higher after Thursday’s June employment report, as a weaker-than-expected payrolls print pressured the U.S. dollar and cooled near-term Federal Reserve tightening expectations. At the time of writing, spot gold was trading near $4,123.80 an ounce, up 2.28%, while spot silver was trading near $61.052, up 3.27% on the session.
The June payrolls report shifted positioning back toward a softer Fed path. Nonfarm payrolls rose 57,000 in June, well below the 115,000 consensus, while unemployment fell to 4.2% and April-May payrolls were revised down by a combined 74,000. The data was weak enough to push the dollar lower and pull the 10-year Treasury yield down to 4.465% at 8:47 a.m. ET, but not clean enough to force an immediate Fed pivot because the lower unemployment rate still points to limited layoffs. Rate traders moved the hike debate further out the curve, with expectations for additional tightening pushed toward December rather than October.
The Strait of Hormuz situation is best characterized as a new, lower-volume operating regime rather than a resolved chokepoint. Daily traffic has stabilized between 30 and 60 crossings over the past seven days, with an average of 40 vessels a day so far this week, but uncertainty remains over whose approval is required to transit the strait. Iran continues to assert the right to manage traffic, while U.S. forces have told mariners that no nation has authority to close or control the waterway.
Traders are watching the early closes in U.S. cash markets ahead of the July 4 holiday and the next inflation data on July 14. Thin holiday liquidity could amplify moves in the dollar, Treasury yields and precious metals.
The key outside markets see Nymex WTI crude oil prices lower and trading around $67.19 a barrel, while Brent crude was near $70.26. The U.S. dollar index is lower. The yield on the benchmark 10-year U.S. Treasury note is trading near the 4.5% area.
Technically, spot gold bulls' next upside price objective is to push prices back above the $4,162.36 to $4,214.34 resistance zone, with a sustained move targeting $4,382.62 and then $4,411.94. Bears' next near-term downside price objective is a break below $3,959.00, with deeper downside targets at $3,942.10 and then $3,886.46. First resistance is seen at $4,162.36 and then at $4,214.34. First support is seen at $3,959.00 and then at $3,942.10.
Spot silver bulls' next upside price objective is to drive prices back above the $60.05 to $63.32 area, with a move above that zone targeting $65.03 and then $69.85. The next downside price objective for the bears is a break below $58.83, with deeper downside targets at $58.00 and then $55.58. First resistance is seen at $60.05 and then at $63.32. Next support is seen at $58.83 and then at $58.00.
