• Gold and silver prices are consolidating as rising US Treasury yields counteract support from a weaker dollar, while investors await Friday’s US inflation data for hints on the Federal Reserve’s policy stance ahead of its December meeting.

• Meanwhile, ADP reported an unexpected 32K reduction in private payrolls, while Challenger reported 71K layoffs in November, increasing the year-to-date total to nearly 1.17 million, indicating a cooling labor market. These events have increased the likelihood of a Fed rate cut next week, with markets pricing in around an 87% chance. This year, gold has increased by more than 60% in dollar terms, the highest performance in 46 years.

• Russian President Vladimir Putin said on Thursday that several proposals in a US plan to end the war in Ukraine are unacceptable, implying that a solution is still some time away. Furthermore, Putin reiterated that Ukrainian troops must evacuate from the Donbas region or Russia will capture it. Geopolitical threats continue to be a factor boosting gold and silver prices.

Technical Triggers        

• Gold has started its upward journey again; the next target is $4300 (~Rs 132,000) and $4345 (~Rs 133,500) with strong support at $4200 (~Rs 129,000).
• Silver can continue its rally towards $60 (~Rs 185,500) and $62 (~Rs 191,000), with firm support at $57 (~Rs 177,000), if tight supply conditions continue.

Support and Resistance