Precious Metals Tumble as US-Iran Truce Brings Uncertainty
The US-Iran truce has left precious metals in a state of uncertainty. Market experts predict that they will remain volatile and trade within a specific range due to ongoing concerns over the fragile peace agreement.
Brent crude oil prices plummeted after the ceasefire announcement, dropping below USD 90 per barrel on Monday. However, prices recovered later in the day. At the time of reporting, Brent crude was trading at around USD 91.93 per barrel, while US crude stood at USD 84.77 per barrel.
Anindya Banerjee, Head of Commodity and Currency Research at Kotak Securities, stated that markets viewed the truce as a first meaningful step towards easing tensions after two weeks of conflict.
Banerjee added that despite Monday's decline, Brent crude remains over 20 per cent higher so far this month. He predicted that it has key support at USD 89-90 per barrel and the immediate trading range is between USD 92-95. A move above USD 101 would signal a return of the uptrend for Brent crude.
Banerjee also forecasted that gold will remain in the USD 3,950-4,200 range. He stated that 'the bears still hold the advantage, though downside momentum has visibly weakened now that buyers have defended USD 3,950, and only a move above USD 4,200 would confirm the trend has turned from down to up.'
Silver is expected to remain range-bound between USD 55.50 and USD 63.20.