Spot gold plummeted 3.14% to trade near $4,456.00 an ounce, while silver dropped 4.24% to $66.210. The selloff was fueled by a significant repricing of interest rate expectations; market odds for a September hike jumped to 57.5% from 35.9%. The two-year Treasury yield rose 11.8 basis points to 4.348%, while the dollar index gained 0.5%, stripping away the appeal of non-yielding assets.

Technically, the damage to the metals market was pronounced. Gold broke through its 200-day moving average at $4,526.24, falling below key bear-market thresholds and testing retracement zones. Silver’s recent breakout structure above $70 stalled, leaving the metal in a precarious position as it struggled to maintain support near $66.00. Investors are now watching to see if this correction represents a momentary flush driven by Warsh’s commentary or the beginning of a deeper technical reset.

Geopolitical tensions, which typically provide a floor for defensive assets, offered little relief. Easing supply concerns in the Strait of Hormuz led to a dip in oil prices, further removing the inflation premium that had previously supported gold. With Brent crude settling at $89.31 and Nymex crude at $83.18, the absence of a fresh energy spike left gold vulnerable to the renewed hawkish momentum from the Fed.