Gold prices fall for the second consecutive week

World gold and silver prices fell in the last trading session of the week, marking the second consecutive week of decline as investors are cautious about the risk of prolonged inflation and the possibility that the Fed will maintain a tough monetary policy longer than expected.

According to Kitco, at the end of the week, spot gold price was around 4,506.3 USD/ounce, down 0.79% in the session. Spot silver price also lost 1.47%, down to 75.43 USD/ounce.

Pressure on precious metals increased as US Treasury bond yields and the USD remained high. The US consumer sentiment index released by the University of Michigan fell from 49.8 points in April to 44.8 points in May. However, inflation expectations in the next year increased to 4.8%, while long-term expectations increased to 3.9%.

Fed Governor Christopher Waller said that the energy shock from the Middle East made him particularly concerned about inflation again. This official emphasized that the Fed is ready to raise interest rates if inflation expectations are out of control.

Developments in the Strait of Hormuz continue to be the focus of the global energy market. Although the US and Iran are said to have made some progress in negotiations, many major disagreements still exist, especially related to enriched uranium and control of this strategic shipping route.

The above information caused oil prices to fluctuate sharply. At one point, US WTI oil increased to about 98.25 USD/barrel, while Brent oil surpassed 105 USD/barrel. Escalating energy prices increased concerns about inflation, thereby strengthening the possibility that the Fed will continue to maintain its "hawkish" stance.

On the technical market, experts believe that gold buyers need to bring prices back to the resistance zone of 4, 530 - 4, 550 USD/ounce to regain the upward momentum. If successfully surpassing this zone, gold prices may head towards the milestones of 4, 660 - 4, 680 USD/ounce and further to 4, 774 USD/ounce.

In the opposite direction, if gold breaks through the support zone of 4,491 USD/ounce, the price may continue to fall deeply to the 4,350 - 4,370 USD/ounce area.

For silver, the nearest resistance level is around the 50-day moving average at 75.98 USD/ounce. If this level is exceeded, silver prices may move up to the 78 - 79 USD/ounce zone. Meanwhile, the important support level is currently around 75 USD/ounce and deeper is the 71 - 72 USD/ounce zone.