Gold and Silver Under Slight Pressure in Asian Session as Safe-Haven Sentiment Cools
In early Asian trading on August 4, sentiment in the international precious metals market was subdued, with spot gold and silver prices both edging lower. As of 11:30 Beijing time, spot gold was at $2,378.50/oz, down 0.28% from the open; spot silver was at $28.12/oz, a daily decline of 0.45%. The US dollar index stabilized near 102.80, becoming the main factor weighing on gold and silver prices. Market news flow focused on the latest progress in Iran nuclear talks, partially offsetting the geopolitical premium that had previously supported gold.
US-Iran Talks Signal De-escalation, Geopolitical Premium Erodes
The main variable driving market sentiment today came from the Middle East. According to multiple foreign media reports, indirect talks between Iran and the US in Oman achieved phased progress, with both sides reaching a preliminary understanding on technical details for transferring part of the enriched uranium stockpile to a third country. Although a final deal remains distant, the market broadly interpreted this as a clear signal of diminishing geopolitical conflict risk.
Previously, tensions in the Strait of Hormuz had pushed international gold prices higher, drawing substantial safe-haven flows into the gold market. Now, with a potential breakthrough in negotiations, some short-term safe-haven funds are choosing to take profits. This 'buy the rumor, sell the fact' logic was particularly evident during the Asian session. Analysts noted that if the US and Iran can reach a phased agreement in the coming weeks, gold prices could shed an additional $15 to $25 of geopolitical premium.
US Dollar Index Stabilizes and Rebounds, Technicals Cap Precious Metals Valuations
Beyond the marginal easing of geopolitical tensions, the short-term rebound in the US Dollar Index was also a key factor pressuring gold and silver. Last Friday, the US core PCE price index rose 2.6% year-on-year, broadly in line with expectations, but personal spending data appeared slightly weak. Markets currently price in about a 68% probability of a 25-basis-point Fed rate cut in September, but expectations for cuts have not expanded further, prompting some dollar shorts to cover.
Technically, the US Dollar Index found support near 102.2 and is currently trading around 102.55. The dollar's mild strength directly suppressed the valuation of dollar-denominated precious metals. For investors in the Asian time zone, the offshore yuan exchange rate stabilized near the 7.18 mark, further narrowing the premium space for domestic gold T+D and silver T+D.
Key Gold Price Levels and Technical Analysis for the Asian Session
From a technical perspective, spot gold tested the key support level at $2,380/oz again in early Asian trading. The 4-hour chart shows the gold price trading below the middle Bollinger Band, with the MACD indicator forming a death cross near the zero line, indicating weak short-term momentum. Upside resistance is at $2,392 (20-day moving average) and $2,405 (previous high-volume node); downside support is at $2,372 (this week's low) and $2,360 (60-day moving average support).
Silver underperformed gold, with the gold/silver ratio climbing further to around 84.5. After breaking below the $28.50 support, bearish technical sentiment intensified, and the price is now testing the psychological $28.00 level. If this level is breached, the next support is seen at $27.60.
Key Data Preview This Week: Focus on ISM Manufacturing PMI
For investors in the Asian session, the US July ISM Manufacturing PMI data due this Friday will be the first key storm of the month. The market expects a reading of 48.8, an improvement from the previous figure but still in contraction territory. Ahead of this, trading is likely to turn cautious, with gold and silver prices expected to remain range-bound.
Additionally, speeches by Fed officials warrant attention. Any hawkish revision to September rate-cut expectations could further boost the dollar, creating short-term pressure on the precious metals market. Strategically, Asian investors are advised to stay on the sidelines ahead of the data release, with short-term range-trading opportunities between $2,370 and $2,390, while strictly setting stop-losses.
Key Focus Today
- Subsequent developments in US-Iran talks and shipping safety in the Strait of Hormuz
- Validity of the $2,370 support level for spot gold
- The battle for the psychological $28.00 level in silver
- Technical resistance for the US Dollar Index near 102.6
