Precious Metals Consolidate, Waiting on FOMC Minutes for Next Catalyst

Gold and silver have stalled after their recent breakouts, as traders wait for the next catalyst to propel them forward. The historic drivers that typically influence precious metals are currently sending conflicting signals.

The Federal Reserve's July FOMC minutes could provide a key turning point in the market, potentially sparking a breakout or reversal of the current consolidation phase.

Despite this uncertainty, gold and silver have maintained their tight relationship with each other, with a five-day correlation of 0.96. However, their usual relationships with macro drivers such as US yields and the dollar are currently muddled.

In fact, gold's correlations with US two-year yields (0.77), 10-year yields (0.78), and 10-year real yields (0.75) over the past five days have been the exact opposite of what would normally be expected fundamentally.