On March 4, pressured by a strong US dollar index and concurrently rising US Treasury yields, the precious metals market experienced significant selling pressure during Tuesday's US afternoon session. The NCE platform noted that although risk aversion stemming from geopolitical conflicts continues to underpin the market, the dollar index hitting a nine-month high and tightening financial conditions from rising Treasury yields have become the dominant factors for gold and silver pricing in the near term. As a result, the price of April gold futures fell sharply to around $5,120.80, while March silver prices also declined, retreating to the $82.60 range.
The increasing complexity of geopolitical conflicts has further heightened market anxiety, but capital flows are showing more cautious characteristics. The NCE platform indicated that investor focus on the Middle East situation is shifting from sudden clashes to the possibility of a "war of attrition." Market data reveals that the cost imbalance between expensive defensive interceptor missiles and low-cost attack methods has raised concerns about the sustainability of air defense inventories. As Iran issued threats to shipping in the Strait of Hormuz, the market began repricing the risk of a prolonged conflict. However, this risk has not directly translated into further breakthroughs for gold prices; instead, it has been suppressed by the rising US dollar's role as a liquidity safe haven. Currently, the 10-year US Treasury yield remains stable around 4.0%, increasing the opportunity cost of holding non-yielding assets like gold.
From a technical analysis perspective, the battle between bulls and bears in the gold and silver markets has entered a critical phase. The NCE platform stated that for gold bulls to regain upward momentum, their primary task is to recover and stabilize above the weekly high of $5,434.10. On the downside, the $5,000.00 mark, serving as both a psychological and technical support level, is facing intense testing by bears. For silver, the bull's target is the resistance level at $95.86, while bears are attempting to push the price below $80.00. Current Wyckoff market ratings show momentum scores of 5.5 for gold and 5.0 for silver, reflecting an overall neutral-to-weak market structure.
In summary, drastic changes in the external macroeconomic environment are forcing precious metals into a period of corrective volatility. The NCE platform suggested that in the contest between the strong dollar cycle and geopolitical risk premiums, investors should closely monitor the support level at the $5,000 mark. Until the situation becomes clearer, the market is likely to maintain wide-ranging fluctuations.