Zaner Daily Precious Metals Commentary
Tuesday, June 24, 2025Gold slides on Israel/Iran ceasefire optimism
OUTSIDE MARKET DEVELOPMENTS: President Trump announced yesterday afternoon that a ceasefire between Israel and Iran would take effect over 24 hours. Since then, both combatants have accused the other of violating the terms of the deal, and Trump expressed his displeasure.
Nonetheless, markets are optimistic about de-escalating Middle East tensions. Oil prices have tumbled, and risk assets are back in vogue.
Fed Chairman Powell is on The Hill today, testifying before the House Financial Services Committee. His prepared remarks highlight that the central bank remains on hold as members “wait to learn more about the likely course of the economy.”
Recent hints from Bowman or Waller that July is in play for a cut haven't gained much traction in the market. Fed funds futures continue to price the first 25 bps cut in October with a second in December. There will be additional FedSpeak from Hammack, Williams, Collins, Barr, and Schmid today.
The current account deficit blew out to a record wide -$450.2 bln in Q1. This was largely driven by a surge in the goods deficit stemming from tariff front-running early in the year. This is contributing to pressure on the dollar, driving the dollar index back within striking distance of the three-year low set last week.
Current Account deficit surged 44.3% to a record-wide -$450.2 bln in Q1, inside expectations of -$452.2 bln, versus a revised -$312.0 bln in Q4'24 (was -$303.9 bln).
S&P/Case-Shiller Home Price Index (20-city) rose 0.7% to a record high 341.5 in April, versus 339.0 in March. The pace of gains slowed to 3.4% y/y from 4.1%.
FHFA Home Price Index declined 0.4% in April to 434.9 from 436.7 in March.
Consumer Confidence fell 5.4 points to 93.0 in June, below expectations of 99.8, versus a revised 98.4 in May (was 98.0).
Richmond Fed Index rose 2 points to -7 in June, in line with expectations, versus -9 in May. It was the fourth straight negative print. There have only been three positive prints since May 2022.
GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CT: -$14.48 (-1.28%)
5-Day Change: -$43.28 (-2.45%)
YTD Range: $2,607.16 - $3,495.89
52-Week Range: $2,295.86 - $3,495.89
Weighted Alpha: +40.88
Gold is under pressure as optimism about a ceasefire between Israel and Iran stoked risk appetite. The yellow metal traded briefly below $3,300 as safe-haven interest faded.
At this point, support at $3,297.69 (9-Jun low) remains intact, leaving gold right around the midpoint of the range that has dominated since mid-May. Renewed weakness in the dollar is helping to underpin the yellow metal.
I'm watching the 50- and 20-day moving averages on a close basis today, which are at $3,324.34 and $3,352.68. The latter seems out of reach, but a close above the 50-day would keep gold in the upper half of the range and be modestly encouraging for the bull camp.
A rebound above the 20-day would bode well for renewed tests above $3,400.00/01.45 and keep the technical bias is favor of the dominant uptrend. Good resistance marked by last week's high at $3,449.13 protects the record high around $3,500.00.
Despite the ceasefire, tensions in the Middle East will remain elevated. President Trump is on his way to a NATO summit in The Hague. He will likely be lauded briefly for his success with Iran (assuming the ceasefire holds), before focus shifts to the elusive ceasefire and peace deal in Ukraine.
If support at $3,299.77/97.69 gives way, focus will shift to secondary support at $3,251.28 (29-May low). I suspect buying interest will build ahead of the latter.
SILVER
OVERNIGHT CHANGE THROUGH 6:00 AM CT: -$0.020 (-0.06%)
5-Day Change: -$1.706 (-4.59%)
YTD Range: $28.565 - $37.288
52-Week Range: $26.524 - $37.288
Weighted Alpha: +23.38
Silver reached a three-week low of $35.369 in early U.S. trading, weighed by the sharp losses in gold. The retreat in oil prices provided some additional pressure to the broader commodities market. However, renewed weakness in the dollar offset some of those pressures.
While white metal has traded lower in four of the last five sessions, the magnitude of the drop is well within expectations and is therefore considered corrective in nature. The 23.6% Fibonacci level at $35.225 has successfully contained the downside thus far. Additionally, the 20-day moving average was briefly penetrated, but the market seems likely to close above that indicator.
New highs for the week above $36.351 would constitute more than 50% retracement of the recent setback and restore a level of confidence to the underlying bull trend. After all, silver set new 13-year highs just last week.
A retreat below the old high at $34.853 would suggest scope for a deeper correction into the previous range. At that point, the $33.949/915 level would be the likely attraction, where the next significant tier of Fibonacci support corresponds with the 50-day MA.
Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
312-549-9986 Direct/Text
[email protected]
www.zanermetals.com
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