Precious metals closed higher on Friday, with gold and silver prices advancing, while crude oil and the U.S. dollar index declined. The moves followed an announcement from Iran that it would reopen the Strait of Hormuz to all commercial vessels. Most Wall Street analysts anticipate gold prices will continue their upward trend in the coming week.
Data showed spot gold rose 0.92% to $4,834.05 per ounce on Friday, marking a weekly gain of 1.78%. COMEX gold futures climbed 1.01% to $4,856.60 per ounce, finishing the week up 1.44%. Spot silver surged 3.27% to $80.9822 per ounce, recording a substantial weekly increase of 6.74%. COMEX silver futures increased 3.09% to $81.720 per ounce, accumulating a weekly gain of 6.04%.
Several analysts expressed bullish outlooks, suggesting gold has the potential to return to the $5,000 level. Peter Grant, Senior Metals Strategist at Zaner Metals, stated, "The reopening of the Strait of Hormuz is a pivotal turning point. Against a backdrop of subdued oil prices, this development is expected to alleviate inflation concerns and rekindle market expectations for interest rate cuts, both of which are positive for gold." He added that gold prices could climb back above $5,000 in the short term.
Peter Cardillo, an analyst at Spartan Capital Securities, noted in a report that the reopening is particularly beneficial for silver, whose fundamentals are already poised for strength. A combination of industrial demand and a resurgence in safe-haven demand could jointly support higher silver prices. He also suggested that if a de-escalation in Middle East tensions leads to a weaker U.S. dollar and lower Treasury yields, gold would have further room to appreciate, as a soft dollar and low-rate environment are traditionally favorable for dollar-denominated, non-yielding bullion.
Marc Chandler, Managing Director at Bannockburn Global Forex, commented, "Gold prices are expected to continue rising next week as markets gradually revert to their previous trading dynamics. Pressure from central bank gold sales may ease, while buying interest is likely to persist. Resistance for gold is seen near $5,000, and momentum indicators are generally positive. Currently, gold is behaving more like a risk asset than purely a hedge against geopolitical conflict or inflation."
Adam Button, Head of Currency Strategy at Forexlive.com, also focused on gold's trajectory post-strait reopening. He said, "Gold is a 'peace trade,' and the current market movement confirms this. During the recent conflict phase, gold was significantly pressured by two main factors: first, deleveraging pressure, as crowded long positions in gold faced concentrated selling; second, concerted gold selling by emerging markets. Emerging economies with substantial gold reserves and high dependence on oil imports saw their currencies under pressure, leading them to sell gold to stabilize their exchange rates or to purchase oil and balance payments." He further pointed out, "Had oil prices remained at elevated levels around $150, emerging markets could have faced a currency crisis, forcing more nations to sell gold reserves to support their currencies, as Turkey had previously done. This risk has now largely subsided."
Button emphasized that emerging market nations still need to further increase their gold reserves to guard against potential future crises. He stated, "Funds are continuously flowing into the gold market, and prices are moving toward the $5,000 mark. Gold is no longer the subject of狂热追捧 it was in January, when nearly everyone was talking about it." Button added, "The confirmation hearing for Fed Chair nominee Kevin Warsh on the 21st is a key event to watch. To secure his nomination, he is likely to strike a dovish tone, and the market will probably choose to believe this message. I expect he will deliver dovish policy signals, and investors could consider going long on gold accordingly."
However, the market outlook is not unanimously bullish. Alex Kuptsikevich, Senior Market Analyst at FxPro, expects gold prices may pull back next week. He said, "Gold is gradually recovering lost ground and recently approached the $4,900 area, which also coincides with the 50-day moving average. This is a direct reaction to the easing Middle East tensions." He also cautioned, "The market needs to be wary of a 'buy the rumor, sell the fact' scenario. Although the upward trend for gold remains intact, the momentum behind the rally has slowed. Next week's focus will be on how gold behaves around the 50-day moving average. A decisive break above $4,900 could pave the way for a test of $5,300 in the coming weeks. However, if prices retreat from this level—which is our more favored scenario—it could signal the end of the current uptrend."
With Middle East tensions easing, market focus is expected to shift back to U.S. economic data, which could influence expectations for Federal Reserve policy and, consequently, the trajectory of precious metals. The U.S. Senate confirmation hearing for Kevin Warsh's nomination as Fed Chair is scheduled for next Tuesday. Market consensus anticipates that Warsh will convey dovish monetary policy signals, which would likely continue to provide support for gold prices.
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