(Kitco NewsWire) - Spot gold prices are modestly lower and spot silver prices are slightly higher ahead of the North American market open Wednesday, as traders kept positioning tight before the Federal Reserve’s rate announcement and Chair Kevin Warsh’s press conference. At the time of writing, spot gold was trading near $4,017.10 an ounce, down 0.27%, while spot silver was trading near $57.08, up 0.15% on the session.
Gold’s early range was $4,009.60 to $4,048.80, leaving the metal above the $4,000 area but below the $4,066 breakout level identified in the latest short-term technical setup. Silver’s early range was $56.75 to $58.36, with the metal holding above $56.88 trendline support but still below the $58.67 resistance area.
Market positioning ahead of this afternoon’s Fed rate announcement remains defensive. The FOMC decision is due at 2 p.m. ET, followed by Warsh’s press conference at 2:30 p.m. ET, and markets broadly expect rates to remain unchanged. However, the meeting is not being treated as a clean hold because futures pricing still assigns roughly a one-third probability to a hike today and a September hike is largely priced in. The 10-year Treasury yield was near 4.62%, while DXY reached 101.64 as traders positioned for a statement and press conference that may keep inflation risk in focus. That leaves gold supported by the $4,000 floor, but capped by higher real-rate expectations and a firm dollar.
The Strait of Hormuz situation is best characterized as open but highly stressed transit under renewed military pressure. A brief pause in the U.S.-Iran conflict broke after Jordan and U.S. forces intercepted another Iranian missile barrage, while crude oil jumped more than 4% as traders repriced chokepoint risk. Brent crude traded near $85.79 and WTI near $83.04, with the waterway still carrying about 20% of the world’s traded oil under normal conditions. For gold, the impact remains two-sided: geopolitical risk supports defensive demand, but higher oil prices lift inflation risk, keep yields firm and limit the upside for non-yielding bullion. For broader markets, the setup is oil bid, equities mixed, the dollar firm and bonds under pressure before the Fed.
Traders are watching the Fed statement, Warsh’s tone on inflation and labor-market risks, Thursday’s GDP data, Friday’s PCE inflation report and any fresh disruption to Hormuz or Red Sea shipping lanes. A sustained move above $4,066 would improve gold’s short-term setup, while a break below $4,011 would put the $3,959 support level back in focus.
The key outside markets see Nymex WTI crude oil prices sharply higher and trading near $83.04 a barrel, while Brent crude was near $85.79. The U.S. dollar index is firmer and trading near 101.64. The yield on the benchmark 10-year U.S. Treasury note is trading near the 4.62% area.
Technically, spot gold bears have the overall near-term technical advantage as prices remain below the 50-period moving average near $4,058 and the 100-period moving average near $4,071, while the metal continues to trade inside a symmetrical triangle ahead of the Fed decision. Bulls' next upside price objective is to push prices back above $4,066, with a sustained move targeting $4,114 and then $4,166. Bears' next near-term downside price objective is a break below $4,011, with deeper downside targets at $3,959 and then $3,913. First resistance is seen at $4,066 and then at $4,114. First support is seen at $4,011 and then at $3,959.
Spot silver bears have the overall near-term technical advantage as prices remain below the 50-period moving average near $58.11 and the 100-period moving average near $58.78, while the metal holds above rising trendline support near $56.88. Silver bulls' next upside price objective is to drive prices back above $58.67, with a move above that level targeting $59.00 and then $60.03. The next downside price objective for the bears is a break below $56.88, with deeper downside targets at $56.11 and then $54.84. First resistance is seen at $58.67 and then at $59.00. Next support is seen at $56.88 and then at $56.11.
