Spot gold and silver moved slightly higher at the start of the week as crude oil prices eased following news that U.S.-Iran talks had resumed. However, the recovery in precious metals remained limited by rising U.S. Treasury yields, a stronger U.S. dollar, and growing expectations that the Federal Reserve could raise interest rates later this year.

At the time of writing, spot gold was trading near USD 4,190.60 per ounce, up 1.21%. Meanwhile, spot silver was trading around USD 65.21 per ounce, up 0.47% on the session.

Fed Expectations Remain the Main Pressure Point

Although the Federal Reserve kept interest rates unchanged at its June meeting, markets are increasingly shifting away from expectations of monetary easing and toward the possibility of another rate hike before the end of the year.

The 10-year U.S. Treasury yield rose to around 4.50%, up from 4.46% previously. Notably, traders are now pricing in nearly a 90% chance that the Fed will raise interest rates at least once before year-end, compared with 57% just one week earlier.

This repricing remains negative for gold and silver, as higher interest rates typically reduce the appeal of non-yielding assets such as precious metals. Amazing how one interest-rate expectation can ruin gold’s entire mood, because apparently markets enjoy being dramatic.

Lower Oil Prices Support Sentiment, but Not Enough for a Breakout

Weekend talks between Washington and Tehran helped ease some geopolitical concerns. Brent crude fell 3.2% to around USD 77.52 per barrel, while U.S. crude dropped 2.6% to near USD 73.86 per barrel.

Lower oil prices helped reduce inflation concerns and supported broader market sentiment. However, risks in the Middle East have not fully disappeared. As a result, gold continued to receive some support from safe-haven demand, but not enough to overcome pressure from rising yields and Fed rate-hike expectations.

U.S. Stocks End Mixed

U.S. equities ended the session mixed. Lower oil prices supported some cyclical sectors, while weakness in major technology stocks weighed on the broader market.

The S&P 500 fell 0.4% to 7,472.79. The Nasdaq Composite dropped 1.3% to 26,166.60. In contrast, the Dow Jones Industrial Average rose 0.3% to 51,712.71, while the Russell 2000 gained 0.8% to 3,004.40.

Technical Outlook for Gold and Silver

For spot gold, the nearest resistance zone is located around USD 4,221–4,226 per ounce. If gold breaks above this area, the next upside targets are USD 4,287 and USD 4,364.

On the downside, key support is seen at USD 4,160. A break below this level could open the way for a deeper decline toward USD 4,073, followed by the psychological USD 4,000 level.

For silver, the key resistance zone to watch is USD 66.99–69.02 per ounce. A breakout above this range could bring the next targets at USD 71.49 and USD 72.00. Initial support is located at USD 64.53, followed by USD 62.92 and then USD 60.00.

Conclusion

Gold and silver are recovering slightly as oil prices ease and geopolitical uncertainty remains present. However, expectations of a Fed rate hike, rising U.S. Treasury yields, and a stronger U.S. dollar continue to cap the upside for precious metals.

In the short term, markets will continue to monitor U.S.-Iran talks, oil price movements, U.S. Treasury yields, and upcoming policy signals from the Federal Reserve to determine the next clearer direction for gold and silver.

Source: Kitco