Trump Reverses TACO Stance, Halting Precious Metals' Decline
Market analysis indicates that US President Donald Trump posted on the social platform "Truth Social" stating that, at the request of the leaders of Qatar, Saudi Arabia, and the United Arab Emirates, he has ordered a halt to the planned military strike against Iran scheduled for May 19. Trump noted that, given the serious negotiations currently underway and the perspective of these leaders and allies, an agreement is ultimately expected to be reached. Crucially, this agreement will explicitly include the core provision that Iran must not possess nuclear weapons. From the Iranian side, sources report that Iran has conveyed a new 14-point negotiation text to the US through Pakistan, with the core content focusing on issues related to "ending the war." Sources close to the US negotiation team indicate that the US has accepted the lifting of oil sanctions on Iran in its new text and has proposed suspending relevant sanctions by the US Treasury's Office of Foreign Assets Control pending a final understanding.
Futures Market and Trading Volume: On 2026-05-18, the main Shanghai gold contract opened at 999.62 yuan per gram and closed at 999.80 yuan per gram, a change of -0.46% from the previous trading day's close. The daily trading volume was 41,087 lots, with open interest at 129,725 lots. In the previous night session, the main Shanghai gold contract opened at 1003.26 yuan per gram and closed at 998.12 yuan per gram, down 0.17% from the afternoon session's close. On 2026-05-18, the main Shanghai silver contract opened at 18,981.00 yuan per kilogram and closed at 18,576.00 yuan per kilogram, a change of -3.25% from the previous trading day's close. The daily trading volume was 574,867 lots, with open interest at 130,144 lots. In the previous night session, the main Shanghai silver contract opened at 18,949 yuan per kilogram and closed at 18,840 yuan per kilogram, up 1.25% from the afternoon session's close.
US Treasury Yield and Spread Monitoring: On 2026-05-18, the US 10-year Treasury yield closed at 4.59%, a change of 0.12% from the previous day. The spread between the 10-year and 2-year yields was 0.50%, a change of 0.03% from the previous day.
Shanghai Futures Exchange Gold and Silver Holdings and Volume Changes: On 2026-05-18, for the Au2606 contract, long positions changed by 887 lots compared to the previous day, while short positions changed by 3,321 lots. The total trading volume for Shanghai gold contracts on the previous trading day was 383,417 lots, a change of 49.84% from the day before. For silver, on the Ag2606 contract, long positions changed by -3,227 lots, and short positions changed by -2,663 lots. The total trading volume for silver contracts on the previous trading day was 1,370,972 lots, a change of 22.14% from the previous day.
Precious Metals ETF Holdings Tracking: For precious metals ETFs, gold ETF holdings were 1,037.42 tons yesterday, a decrease of 2.57 tons from the previous day. Silver ETF holdings were 15,189 tons, a decrease of 34 tons from the previous day.
Precious Metals Arbitrage Tracking: Spot-Futures Basis: On 2026-05-18, for domestic premiums, the gold domestic premium was 10.93 yuan per gram, and the silver domestic premium was 308.56 yuan per kilogram. Gold-Silver Ratio: The price ratio of the main Shanghai gold and silver contracts yesterday was approximately 53.82, a change of 8.67% from the previous day. The international gold-silver ratio was 57.83, a change of 7.01% from the previous trading day.
Fundamentals: Shanghai Gold Exchange T+D Market Monitoring: On the previous trading day (2026-05-18), gold trading volume on the SGE was 66,122 kilograms, a change of 122.32% from the previous day. Silver trading volume was 646,982 kilograms, a change of -15.73% from the previous day. Gold delivery volume was 11,872 kilograms, and silver delivery volume was 63,690 kilograms.
Strategy: Gold: Cautiously Bullish. Current market risk sentiment has cooled, and the impact of liquidity shocks on gold prices may converge. Therefore, it is expected that gold prices will mainly follow a pattern of consolidation and recovery in the near term. The Au2606 contract's consolidation range may be between 990 yuan per gram and 1020 yuan per gram. Silver: Cautiously Bullish. Due to the recovery in risk sentiment, silver prices are currently slightly stronger compared to gold. Silver prices themselves are also expected to maintain a pattern of consolidation and recovery. The Ag2606 contract's consolidation range may be between 18,500 yuan per kilogram and 19,500 yuan per kilogram. Arbitrage: Short the gold-silver ratio on rallies. Options: Hold off.
Risks: Overseas liquidity risk; speculative positions continuing to unwind.
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