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January Set to End on Positive Note Despite Threat of Russian Invasion Looming Large
Kinesis Gold Price Analysis: Gold is following the flock so far on Monday with the price on the rise, pushing up to around $1,790 an ounce.
The precious metal suffered a sharp reversal in fortunes last week, going from challenging $1,850 an ounce to sinking below the psychologically important threshold of $1,800.
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The two main drivers of the market this week are likely to have a contrasting impact on gold. Any sign of further escalation in tensions over Ukraine is likely to be supportive for gold as investors seek out haven assets in a flight to safety.
While the Bank of England’s likely rate hike would be detrimental for gold, it would be further confirmation that global interest rates are on the rise, making the non-yield-bearing asset of gold less attractive.
Kinesis Silver Price Analysis: Read More
Monday's rally in gold should fail
This morning we are seeing gold, silver, and platinum rallying. Gold is up about $6.00, silver $0.20 and platinum is up $7.00. We expect these rallies to fail. Maybe not this morning or today, but over the next few days.
When trading with the trend, you want to pick your spots; we would be looking for spots to sell. Right now, we would be looking at $1,800 gold, $23.00 in silver, and $1,015 in platinum. Those would be comfortable levels to add to short positions.
Remember, we are trading here; this information has nothing to do with long-term holds. The metals look weak, and the selling should continue even with a weak equity market, which has reversed lower this morning. We have an opportunity with all significant trends turning lower - be prepared. Read More
Gold price should be above $2,000 as inflation 'screams red hot' - WisdomTree's Nitesh Shah
With inflation running hot around the world, gold prices should be well over $2,000, according to Nitesh Shah, director of commodity research at WisdomTree.
Monday, in the latest Kitco News commodity podcast with Neils Christensen, editor of Kitco News, and Phillip Streible, chief market strategist at Blue Line Futures, Shah noted that consumer inflation is currently at 7%, its highest level in 40 years, at the same time European inflation has risen to 5%.
"Inflation numbers are screaming red hot. They are numbers that should be sending gold much, much higher than where they are today," he said. Shah's comments come as February gold recovered from a 3% decline last week, bouncing off support at $1,780 an ounce. The price is currently back within striking distance of $1,800 an ounce, last trading at $1,795.50 an ounce, up 0.65% on the day. Listen to the podcast
Short-covering rebounds, bargain hunting in gold, silver
Gold and silver futures prices higher in midday U.S. trading Monday, on short covering in the futures markets and perceived bargain hunting in the cash markets, following recent solid losses. Both metals are still somewhat oversold on a short-term technical basis and are due for some additional corrective upside action this week. April gold futures were last up $10.90 at $1,797.40 and March Comex silver was last up $0.129 at $22.435 an ounce.
Technically, April gold futures bulls have a slight overall near-term technical advantage but need to show more power soon to keep it. Bulls' next upside price objective is to produce a close above solid resistance at the January high of $1,856.70. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the December low of $1,755.40. First resistance is seen at $1,810.00 and then at $1,820.00. First support is seen at today’s low of $1,785.80 and then at the January low of $1,780.60. Wyckoff's Market Rating: 5.5. Read More
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'Permanent' inflation to end the days of high returns - world's largest wealth fund
Elevated inflation levels will lead to years of low returns in the stock and bonds markets, warned the world's largest sovereign wealth fund CEO.
Price increases "could be stronger than what is generally expected," Nicolai Tangen, CEO of Norway's $1.3 trillion sovereign wealth fund, told the Financial Times. "[I'm] the team leader for team permanent."
Red hot inflation has been seen all across the globe. In the U.S., price pressures reached the highest level in four decades, with the consumer price index rising 7% in December. Higher prices are being blamed on supply chain disruptions and quickly rising demand.
"We are seeing it across the board, in more and more places. You saw Ikea increasing prices by 9%, you have seen food prices going up, continued very high freight rates, trucking rates, metals, commodities, energy, gas . . . We're seeing signs on wages as well," Tangen said. Read More
Geopolitical risks can't support gold forever, interest rate headwinds continue to build - USBWM
Geopolitical risks are creating some support for gold in the near term. However, the precious metal still faces a challenging year as the Federal Reserve looks to tighten its monetary policy aggressively to bring inflation back under control, according to one market analyst.
Rob Haworth, senior investment strategist at U.S. Bank Wealth Management, said in a recent telephone interview that while rising geopolitical tensions between the U.S. and Russia continue to heat up, the gold market can't ignore the fundamental environment in the long term.
"Gold prices can move higher in the near term, but geopolitical uncertainty is not a long-term sustainable driver because, ultimately, it gets resolved in some way, shape, or form,"he said. "At some point, the fundamentals will reassert themselves."
His comments come as gold prices remain below $1,800 an ounce after dropping 3% last week after the Federal Reserve said it expected to raise interest rates soon. Read More
Gold is 'prime candidate' to rally as stocks reverse in 2022 - Bloomberg Intelligence
The sentiment in the gold market has reached its "maximum disdain," which means that gold is primed for a reversal and could be ready to rally past $1,900 an ounce, according to Bloomberg Intelligence.
As the Federal Reserve gears up to raise rates and reduce liquidity, the precious metal is a potential top performer this year, said Bloomberg Intelligence senior commodity strategist Mike McGlone.
And after a year of consolidation, gold has formed a solid price bottom at around $1,700 an ounce.
"The elongated stock-market rally, recent commodity bounce and competition from Bitcoin may have pushed the metal close to maximum disdain, solidifying gold's foundation vs. the 'there's no alternative' mantra," McGlone said in a report. "We see gold-bottoming parallels to the 2008 and 2018 foundations."
Gold's potential upside stems from the Fed's hawkish stance to fight inflation as the U.S. stock market gives up last year's gains. Read More
Death cross averted in gold and technical studies indicate a possible bottom
On Friday my article spoke about the fact that it seems as though a pattern called a “Death Cross” was imminent. I said this because the difference between the 50- and 200-day moving averages was only $0.20. The short-term 50-day moving average was fixed at $1805.70, and the 200-day moving average was fixed at $1805.50. That critical difference grew much wider today as gold prices gained approximately $11. As of 6:10 PM EST, the most active April 2022 Comex contract is currently fixed at $1798.70 as it is currently trading up by $2.30 overseas.
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Today’s gains in gold were directly attributable to dollar weakness. The dollar index lost 0.63% and is currently fixed at 96.65. Trading in New York resulted in gold gaining 0.62%, gold’s gain today was almost the exact percentage that the dollar declined which meant that neither the bullish or bearish faction was able to move pricing in any direction. Read More
Gold and silver push higher ahead of the European open
Gold has moved higher leading into the European open. The yellow metal moved 0.36% higher to trade just above the psychological $1800oz area once again. Silver also moved up 0.40%. In the rest of the commodities complex, copper rose 0.32% and spot WTI is trading flat.
In the Asia Pac area, the Nikkei 225 (0.28%) and ASX (0.49%) followed the lead from Wall St. to move higher. Futures in Europe are pointing towards a positive open.
In FX markets, the dollar index is -0.14% lower overnight with the biggest mover being USD/CHF (-0.31%). In the crypto space, bitcoin is trading flat at $38,441. Read More
Disclaimer: These articles are provided for informational purposes only. They are not offered or intended to be used as legal, tax, investment, financial, or any other advice.
