Gold and silver extend to multi-week highs on haven bid
Outside Market Developments: Last week's Supreme Court ruling against the Trump administration's use of the International Emergency Economic Powers Act to impose sweeping tariffs is stoking uncertainty and risk aversion at the start of the week. Trump blasted the ruling as "terrible" and "extraordinarily anti-American," and quickly announced he would impose a new temporary 15% global tariff on all imports using an alternative legal authority.
Treasury Secretary Bessent downplayed the ruling's impact, framing it as narrow and technical rather than a rejection of Trump's tariff strategy overall. He did acknowledge a loss of leverage, but went on to say, "in a way, they have made the leverage that he has more draconian" because the ruling affirmed the president's authority for a "full embargo" or product-line cutoffs if no revenue is generated.
SCOTUS punted on the issue of refunding the $130-$175 billion in tariff revenue generated thus far. That burning question will likely be resolved in the lower courts, but it will take months or perhaps even longer.
Tensions between the United States and Iran remain extremely high, with the situation teetering between last-ditch diplomacy and the credible threat of U.S. military action. The core issue is Iran's nuclear program, where the Trump administration demands zero uranium enrichment on Iranian soil, curbs on ballistic missiles, and reduced support for regional proxies—demands Tehran has largely rejected so far.
A third round of indirect negotiations is scheduled for later this week in Geneva. Iran is expected to present a detailed counterproposal soon, but the 86-year-old Supreme Leader is widely regarded as recalcitrant when it comes to U.S. demands.
Mexico is experiencing widespread violence and chaos following the killing of the leader of the powerful Jalisco New Generation Cartel during a Mexican military operation on Sunday, aided by U.S. intelligence. The cartel retaliated with coordinated attacks – torching buses, businesses, and clashing with security forces – resulting in dozens of deaths.
The U.S. State Department has directed American citizens in affected areas of Mexico to shelter in place amid fears of escalating unrest. If any Americans are harmed or kidnapped, Trump would likely respond with intense pressure on the Mexican government, and arguably, direct military intervention against cartel assets would be on the table.
State of the Union addresses are not typically big market movers. However, in light of everything going on right now, tomorrow night's speech before Congress has the potential to further stoke uncertainty. Trump will tout economic gains, affordability measures, cartel crackdowns, and his success in sealing the southern border. He will likely defend his tariff policies and aggressive immigration enforcement, while also addressing foreign policy hotspots and heightened trade tensions.
GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CT: +$42.93 (+0.84%)
5-Day Change: +$220.09 (+4.41%)
YTD Range: $4,310.83 - $5,595.02
52-Week Range: $2,835.23 - $5,595.02
Weighted Alpha: +87.27
Gold begins the week on the bid, buoyed by ongoing haven interest and a slightly easier dollar. The yellow metal has extended to more than three-week highs, trading above $5,200 for the first time since the 30-Jan plunge.
Following Friday's close above the 20-day moving average, more than 61.8% of the entire decline from $5,595.02 has now been retraced. The technical improvement and the winding down of the Lunar New Year holiday in Asia are likely to embolden the bull camp. The next levels to watch on the upside ar $5,300 and $5,340.72 (78.6% retracement).
Asian markets dominate global physical gold flows. As traders and investors return from holiday, we're already hearing rumblings of tight physical supply that would be price supportive.
Net ETF inflows were a scant 2.5 tonnes last week, reflecting a tentative investor base and diminished Asian interest during the holiday. The North American region was responsible for 3.1 tonnes of inflows, Europe saw modest outflows, and Asia was unchanged.
Today's early U.S. low at $5,152.56 protects more substantial support at $5,107.62/05. The rising 20-day moving average at $5,024.65 will remain significant on a close basis.
SILVER
OVERNIGHT CHANGE THROUGH 6:00 AM CT: +$1.963 (+2.32%)
5-Day Change: +$11.719 (+15.29%)
YTD Range: $64.14 - $121.630
52-Week Range: $28.565 - $121.630
Weighted Alpha: +203.76
Silver is up more than 2%, driven by safe-haven interest and a softer dollar. The white metal is getting an additional boost from the chaos in Mexico that has raised concerns about supply disruptions. 
Mexico is the world's largest producer of silver, accounting for roughly 25% of global mine output. Mexico produced approximately 6,300 metric tonnes of silver in 2024, and production is expected to remain steady to slightly higher through 2026.
Friday's close above the 50-day MA was encouraging, shifting focus to the $86.233/287 (11-Feb high and 20-day MA). With the latter now definitely exceeded as well, sights are now on $90, $92.186 (04-Feb high), and the halfway back point of the Jan/Feb decline at $92.885.
A rise into the upper half of the range is needed to revive confidence in the long-term uptrend. While extreme volatility is likely to persist for the foreseeable future, I suspect the bulls will now buy on dips with a little less trepidation. Minor supports at $88, $87.420, and $85.741/586 stand in front of the more important $84.730/625 zone.
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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