Gold, silver see strong losses amid weak long liquidation

Gold and silver markets experienced significant volatility on Tuesday, with sharp downward price movements driven by multiple macroeconomic factors and trading dynamics. Geopolitical premiums appeared to be diminishing, contributing to the metals' bearish sentiment.

The precious metals market witnessed strong losses, with April gold futures dropping $141.50 to $4,904.10 and March silver prices plummeting $4.174 to $73.66. This dramatic decline was primarily attributed to weak long liquidation from short-term futures traders, compounded by external market pressures including a rallying U.S. dollar index and declining crude oil prices.

Key market indicators suggested a complex trading environment. The U.S. dollar index showed strength, while crude oil traded around $62.25 per barrel. The benchmark 10-year U.S. Treasury note yield hovered at approximately 4.03%, marking a 2.5-month low. These macroeconomic conditions created a challenging landscape for precious metals investors.

Technically, gold futures traders are closely watching critical price levels. Bulls aim to breach resistance at $5,250.00, while bears target pushing prices below the recent low of $4,670.00. For silver, market participants are monitoring support and resistance zones between $63.90 and $86.12, reflecting the ongoing market uncertainty.

The ongoing geopolitical discussions between the U.S. and Iran in Geneva, though unlikely to yield immediate resolutions, also subtly influenced market sentiment. Strategic movements in mining sectors continue to provide underlying support for precious metals markets, despite short-term volatility.

Looking forward, investors should remain vigilant. The interplay between geopolitical tensions, currency movements, and industrial demand will likely continue to drive precious metals pricing. Disciplined risk management and close monitoring of technical indicators will be crucial in navigating these complex market conditions.