Spot gold and silver prices fell sharply Thursday ahead of the North American market open, as firmer Treasury yields, a steadier U.S. dollar and renewed Strait of Hormuz risk outweighed support from this week's softer inflation data. At the time of writing, spot gold was trading near $3,975 an ounce, down about 2.1%, while spot silver was trading near $55.90, down about 3.3% on the session. The decline followed a shift in positioning after the latest economic data, moving away from the immediate dovish reaction to CPI and PPI releases.
Retail Sales and Jobless Claims Data Show Economic Resilience
Gold's early range was $3,973 to $4,067, with the metal setting a fresh session low and breaking below the $4,000 area for the first time in the current pullback. Silver's early range was roughly $55.80 to $58.04, with the metal extending its break below the $57.15 demand zone and trading well below the $58.97 and $60.45 moving averages.
Retail sales rose 0.2% in June, in line with expectations, while initial jobless claims fell by 8,000 to 208,000, the lowest level in 10 weeks and below expectations near 218,000. Headline CPI fell 0.4% in June and final-demand PPI fell 0.3%. Markets still see the Fed holding rates at the July 29 meeting, with hold odds near 90%, but the 10-year Treasury yield was back near 4.57%, the 2-year yield was near 4.16% and DXY was edging higher near 100.54.
U.S. Expands Strikes Into Northern Iran as Oil Prices Rise
The U.S. expanded strikes into northern Iran and disabled a tanker it said was trying to breach the blockade, while Iran continued missile and drone attacks against U.S.-allied targets in Bahrain, Jordan and Kuwait. Oil prices rose again, with Brent near $86 and WTI near $80.70, as traders priced the risk of further disruption around the waterway. The Strait of Hormuz situation is characterized as open transit under severe military pressure and blockade risk, not a normalized shipping environment.
Gold Breaks Below $4,000 as Technical Support Tested
Spot gold bears have the overall near-term technical advantage as prices broke below $4,000 and tested the $3,973 area, putting the triple-bottom support zone near $3,959 back in play. Bulls' next upside price objective is to push prices back above $4,044, with a sustained move targeting the 50-period moving average near $4,094 and then $4,140. Bears' next near-term downside price objective is a break below $3,959, with deeper downside targets at $3,942 and then $3,886. First resistance is seen at $4,044 and then at $4,094. First support is seen at $3,973 and then at $3,959.
Spot silver bears have the overall near-term technical advantage as prices broke below $57.15 and moved toward the $56.50 stop area. Silver bulls' next upside price objective is to drive prices back above $57.52, with a move above that level targeting $58.83 and then $60.41. The next downside price objective for the bears is a break below $56.50, with deeper downside targets at $55.60 and then $55.00. First resistance is seen at $57.52 and then at $58.83. Next support is seen at $56.50 and then at $55.60.
The key outside markets see Nymex WTI crude oil prices firmer and trading around $80.70 a barrel, while Brent crude was near $86.00. The U.S. dollar index is firmer and trading near 100.54. The yield on the benchmark 10-year U.S. Treasury note is trading near the 4.57% area.
FAQ
Why did gold and silver prices fall Thursday?
Gold and silver prices fell sharply Thursday as firmer Treasury yields, a steadier U.S. dollar and renewed Strait of Hormuz risk outweighed support from this week's softer inflation data. The 10-year Treasury yield was back near 4.57%, the 2-year yield was near 4.16%, and DXY was edging higher near 100.54.
What did the latest U.S. economic data show?
Retail sales rose 0.2% in June, in line with expectations, while initial jobless claims fell by 8,000 to 208,000, the lowest level in 10 weeks and below expectations near 218,000. Headline CPI fell 0.4% in June and final-demand PPI fell 0.3%.
What are the key technical support and resistance levels for gold?
For spot gold, first support is seen at $3,973 and then at $3,959, with deeper downside targets at $3,942 and then $3,886. First resistance is seen at $4,044 and then at $4,094, with the 50-period moving average near $4,094 and further resistance at $4,140.
