More Stories

Informist, Thursday, Jun. 5, 2025

MUMBAI – Gold and silver prices have broken above their key technical barriers amid a weakening dollar and rising global tensions, according to Ole Hansen, head of commodity strategy at Saxo Bank. A further upside is possible in gold and silver as the macro setup is shifting in favour of precious metals, Hansen said in a report.

Hansen said protectionist trade policies by the US and rising political polarisation, which was once viewed as transitory, are increasingly seen as structural risks and are prompting sovereign wealth funds and institutional investors to rebalance away from overexposure to US equities and Treasuries. "This reallocation has already played a visible role in lifting gold prices, as investors seek insulation from mounting concerns around US fiscal sustainability," he added.

Technically, gold has now broken above the downtrend from its April 22 record high at $3,500, with that former resistance line now turning into support near $3,325. Additional layers of support are seen at $3,280 and the 55-day moving average of $3,223, Hansen said.

At 1709 IST, the most-active August gold contract on the COMEX was 0.6% higher at $3,420.8 per ounce and the most-active July silver contract was 4% higher at $36.18 per ounce.
 

Silver's dual role as both a monetary and industrial metal makes its performance tightly linked not only to gold and dollar movements but also to industrial demand signals, particularly from copper, Hansen said.

He added that another key dynamic to monitor is silver's relative strength against gold, with the gold-silver ratio showing early signs of a breakdown below 98 after recently hitting a high above 105. "Note, the ratio's five-year average is much lower at around 82, and while we do not envisage a return to that level, given the relative stronger pull in gold from central banks, a softening back towards the upper end of the 2023 to 2024 trading range around 91.5 cannot be ruled out," Hansen said.

On copper, Hansen said the market is concerned that the current flow of copper heading to the US ahead of the tariff announcement will remain stranded until consumed, further tightening an already constrained global market into the second half of 2025.

"The copper probe, launched in February under Section 232 of the Trade Expansion Act, is expected to conclude within weeks, and the resulting announcement is likely to trigger a major price adjustment—particularly in the spread between London and New York copper—which reflects the market's attempt to price in the eventual tariff level," Hansen said.  End

Reported by Ashutosh Pati

Edited by Saji George Titus

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000 

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2025. All rights reserved.