Gold and silver prices moved higher in late U.S. trading on Thursday, supported by weaker crude oil prices, softer U.S. Treasury yields and a lower U.S. dollar. Investors are now turning their attention to the U.S. May employment report, which is expected to be released on Friday.

At the time of writing, spot gold was trading near USD 4,477.70 per ounce, up 0.97%. Spot silver traded at USD 73.955 per ounce, gaining 1.66% on the session.

U.S. labor market data showed that initial jobless claims rose by 13,000 to 225,000 in the week ending May 30. Meanwhile, continuing claims fell by 8,000 to 1.777 million for the week ending May 23. The data suggests that the U.S. labor market may be cooling slightly, but not enough to settle the Federal Reserve policy debate ahead of the nonfarm payrolls report.

Geopolitical developments remain an important driver for gold, oil, Treasury yields and equity risk. Although tensions around the Strait of Hormuz continue to keep a risk premium in crude oil prices, markets are currently treating the U.S.-Iran situation more as a “managed disruption” rather than a full supply shock.

Oil prices fell as traders priced in the possibility of a potential U.S.-Iran deal. Nymex WTI crude traded around USD 93.02 per barrel, while Brent crude was near USD 95.22 per barrel. Lower oil prices helped ease inflation pressure, pushed Treasury yields lower and provided additional support for gold.

U.S. equities also saw a positive rotation. The Dow Jones Industrial Average rose 874.86 points, or 1.7%, to a record 51,561.93. The S&P 500 gained 0.4%, while the Nasdaq Composite slipped slightly by 0.1%. The Russell 2000 advanced 1.4%, supported by expectations of lower borrowing costs for smaller companies.

From a technical perspective, gold needs to break above the USD 4,530 - 4,550 per ounce resistance zone to strengthen its upside momentum. A sustained move above this area could open the way toward the 50-day moving average near USD 4,628.99, followed by the USD 4,660 - 4,680 zone. On the downside, a break below USD 4,425 could expose deeper support levels at USD 4,370 and USD 4,350.

For silver, the key resistance level is around the 50-day moving average at USD 76.15 per ounce. A move above this level could target USD 78 and then USD 79. On the downside, the important support zone remains between USD 71 - 72 per ounce.

Overall, gold and silver are being supported by weaker oil prices, a softer U.S. dollar and lower Treasury yields. However, the upcoming U.S. employment report will be a key factor that could influence Fed policy expectations and the short-term direction of precious metals.

This content is for market information purposes only and does not constitute investment advice or a buy/sell recommendation.

Source: Kitco