Gold and silver prices rallied following renewed hopes of a US-Iran deal, which pushed oil prices lower and eased inflation concerns, according to ING’s commodities strategists Ewa Manthey and Warren Patterson [1]. Lower energy prices weighed on yields, while the US Dollar remained near pre-war levels, supporting non-yielding assets like gold and silver [1][2]. Gold jumped 3%, climbing back above $4,700/oz, reversing part of its recent war-driven weakness. ING notes that the potential easing in energy prices gives the Federal Reserve more room to cut rates, which is positive for gold [1].
Silver outperformed gold, supported by lower yields and stronger risk appetite. XAG/USD appreciated for the second consecutive day, testing April 22 highs at $78.70, with bulls aiming for the $80.00 psychological area [2]. News of the US and Iran nearing a peace deal boosted investor risk appetite and sent the US Dollar tumbling, providing a fresh boost to precious metals [2]. Oil prices declined nearly 8%, pushing US Treasury yields lower and providing additional support to yieldless precious metals [2].
Technical analysis indicates that XAG/USD performed a sharp recovery on Wednesday, printing a bullish engulfing candle on the daily chart, confirming a trend shift is in progress [2]. Technical indicators are in bullish territory, but the oversold levels in the 4-hour Relative Strength Index (RSI) suggest that the latest advance is stretched and a consolidation or pullback might be ahead. The Moving Average Convergence Divergence (MACD) remains positive, reinforcing upside pressure [2]. Recent price action suggests the pair is in the C-D leg of a Gartley pattern, aiming for the April 20 highs above $80.00, with potential resistance at April's peak of $83.06. On the downside, support is seen at $76.70 and $72.15 [2].
ING strategists expect precious metals, including silver, to remain sensitive to US-Iran headlines, oil prices, and Federal Reserve rate expectations. A sustained fall in energy prices would keep gold and silver supported, while any setback in talks could reverse part of the move [1].
CONCLUSION
Gold and silver have surged on the back of US-Iran deal hopes, lower oil prices, and easing inflation concerns, with silver outperforming and targeting key resistance levels. Market sentiment is bullish, but technical indicators suggest a possible near-term consolidation. Precious metals are expected to remain highly sensitive to geopolitical developments and Federal Reserve policy expectations.