(Kitco NewsWire) - Spot gold and silver prices are sharply higher in late-afternoon U.S. trading Tuesday, as short covering and renewed haven demand lifted metals despite rising Treasury yields, a firmer U.S. dollar and another jump in crude oil prices tied to the U.S.-Iran conflict. At the time of writing, spot gold was trading near $4,080.20 an ounce, up 1.83%, while spot silver was trading near $58.70, up 4.29% on the session.
Gold’s session range was $3,998.80 to $4,087.30, leaving the metal back above the $4,000 area and through the $4,041.65 to $4,072.40 retracement zone identified in the latest technical setup. Silver’s session range was $56.00 to $59.37, with the metal recovering above the 50-period moving average near $57.68 and testing the $58.53 to $59.44 trader-reaction area that capped the prior breakout.
North American equities closed higher as semiconductor and AI-linked shares extended their rebound. The S&P 500 rose 65.92 points, or 0.9%, to 7,509.20, the Nasdaq Composite gained 329.13 points, or 1.3%, to 25,837.21, the Dow Jones Industrial Average added 385.38 points, or 0.7%, to 52,224.64 and the Russell 2000 rose 44.97 points, or 1.5%, to 2,987.40. In Canada, the S&P/TSX Composite rose 374.08 points, or 1.07%, to 35,334.40.
European equities also finished higher, led by technology, mining and energy-linked shares. The STOXX Europe 600 rose 3.59 points, or 0.56%, to 643.19, Germany’s DAX gained 164.66 points, or 0.66%, to 25,011.35, France’s CAC 40 added 23.03 points, or 0.28%, to 8,363.14 and London’s FTSE 100 rose 61.15 points, or 0.58%, to 10,585.91.
Positioning after the latest economic data remains less dovish than the earlier CPI and PPI reaction suggested. There were no major U.S. data releases Tuesday, leaving the market focused on Fed communication, oil and the July 29 policy meeting. September hike odds were near 63%, down from about 90% before last week’s inflation data but still high enough to keep rate risk alive. The 2-year Treasury yield rose to 4.261%, the 10-year yield climbed to 4.628% and the U.S. dollar index was near 101.22.
The Strait of Hormuz situation is best characterized as open but severely impaired transit under active military pressure. The U.S. and Iran continued daily strikes around the waterway, mediators pushed a proposed 10-day ceasefire and a tanker was hit near the Strait of Hormuz, while Houthi threats against Saudi-linked shipping added a second chokepoint risk around the Red Sea. Brent crude settled at $91.01 a barrel and WTI closed at $84.91, keeping energy inflation risk in the foreground. For gold, the impact remains two-sided: geopolitical risk and ceasefire uncertainty support defensive demand, while higher oil, rising yields and a firmer dollar normally limit upside. Tuesday’s move shows bullion trading the possibility that diplomacy can cool crude before the rate channel tightens further.
Traders are watching ceasefire headlines, Fed communication, Friday’s flash PMI reports and any further disruption to Hormuz or Red Sea shipping lanes. A sustained hold above $4,072.40 would improve gold’s short-term setup, while a reversal back below $4,041.65 would signal that higher yields are again regaining control.
The key outside markets see Nymex WTI crude oil prices sharply higher and settled near $84.91 a barrel, while Brent crude settled near $91.01. The U.S. dollar index is firmer and trading near 101.22. The yield on the benchmark 10-year U.S. Treasury note is trading near the 4.63% area.
Technically, spot gold bulls have regained the near-term technical advantage after prices rebounded from $3,998.80 and pushed through the $4,041.65 to $4,072.40 retracement zone. Bulls' next upside price objective is to push prices back above $4,087.30, with a sustained move targeting $4,162.36 and then $4,214.34. Bears' next near-term downside price objective is a break below $3,998.80, with deeper downside targets at $3,959.80 and then $3,942.10. First resistance is seen at $4,087.30 and then at $4,162.36. First support is seen at $4,041.65 and then at $3,998.80.
Spot silver bulls have improved the near-term technical setup after prices recovered above the 50-period moving average at $57.68 and tested the $59.15 resistance area. Silver bulls' next upside price objective is to drive prices back above $59.15, with a move above that level targeting $62.75 and then $64.86. The next downside price objective for the bears is a break below $56.00, with deeper downside targets at $54.92 and then $52.67. First resistance is seen at $59.15 and then at $62.75. Next support is seen at $56.00 and then at $54.92.
