Today's Gold and Silver News - 13th September

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Gold Gains Despite Central Bank Aggression as Markets Rebalance

Gold starts a new trading week edging slightly higher to underline that the haven asset remains in demand despite the aggressive monetary policies adopted globally by central banks.

A slight weakening in the US dollar has given gold more breathing space and enabled the precious metal to climb further away from the $1,700 an ounce threshold.

The fact that equities and the Euro are also gaining suggests that today’s moves are largely corrective ones after a punishing recent period for both stock markets and the single currency – with gold a willing beneficiary of this slight reappraisal. Read More

Silver’s Good Run Continues as Traders Buy Undervalued Asset

Silver’s good recent run continues with the metal now above $19 an ounce even as both the European Central Bank and the Federal Reserve look set on a series of significant rate hikes in the coming months.

The fact that silver has been able to make these recent gains – even though the macroeconomic picture remains very hawkish – suggests that the precious metal had been oversold and overly punished by the prospect of ever-rising interest rates with traders now buying silver with the asset seen to be considerably below its fair value.

Silver’s recovery back above $19 an ounce will be of relief to investors, but the metal still remains considerably below where it was trading just a few months ago and the current levels still put it at the bottom end of its trading range of the last two years. Read More

Gold prices holding a solid floor around $1,700 by year-end - Bank of America

Many gold investors have been frustrated with gold's price action so far this year as the prices have declined nearly 5%; However, commodity analysts at Bank of America have a slightly more optimistic view of the precious metal.

In a report Monday, the analysts said that in the current environment, gold prices are 10% to 15% above fair value. The comments come as gold sees renewed momentum after bouncing off support at $1,700 an ounce. December gold futures last traded at $1,743.70 an ounce, up 0.83% on the day.

"In our view, the gold market is factoring in break-evens well above 3% at the moment. All-in, we can justify gold prices stabilizing just below $1,700/oz by the end of the year," the analysts said.

Although the U.S. dollar and rising U.S. interest rates continue to present strong headwinds for the gold market, analysts at Bank of America see a solid floor for now. Read More

Silver prices see short squeeze, testing resistance near $20, up 6% on weak dollar

Solid selling pressure on the U.S. dollar has created a significant short squeeze in silver, as the marketing starts the week with a 6% rally.

Silver is seeing a solid breakout move and, according to some analysts, could be in a position to push back above $20 an ounce, which has been an important psychological level through the summer.

Monday's rally is a solid reversal of fortunes after prices fell to a two-year low below $17.50 an ounce at the start of the month. December silver futures last traded at $19.91 an ounce. Silver is seeing its best day since late July when markets started prematurely expecting the Federal Reserve to pivot and slow the pace of its aggressive monetary policy stance.

According to analysts, silver is benefiting from a sharp drop in the U.S. dollar, which hit a fresh 20-year high last week. Analysts said that fuel added to the rally is significant bearish short positioning in the market. The rally is forcing investors with short positions to cover at higher prices. Read More

Gold gains, silver surges as USDX slumps

Gold is moderately higher and silver sharply up in midday U.S. trading Monday. The precious metals are supported by a depreciating U.S. dollar on the foreign exchange market. The U.S. dollar index is sharply lower today and hit a two-week low after last week posting a 20-year high. A dip in U.S. Treasury yields to start the trading week is also a positive for the precious metals markets. October gold was last up $14.00 at $1,733.00 and December silver was up $1.088 at $19.865.

Traders and investors are awaiting the latest U.S. inflation report on Tuesday. The August consumer price index is seen coming in up 8.0%, year-on-year, compared to the July report showing an 8.5% rise. There are some signs in the economy that inflation in the U.S. is cooling off a bit.

Technically,October gold futures bears still have the firm overall near-term technical advantage. However, a four-week-old downtrend on the daily bar chart is now in jeopardy. There is also the potential for a big and bullish double-bottom reversal pattern forming on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,769.30. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the July low of $1,686.30. First resistance is seen at $1,740.00 and then at $1,750.00. First support is seen at today’s low of $1,712.70 and then at $1,700.00. Wyckoff's Market Rating: 2.5.

Image Source: Kitco News

December silver futures prices hit a three-week high today. The silver bears have the overall near-term technical advantage. However, the bulls have momentum on their side to suggest a market bottom is in place. Silver bulls' next upside price objective is closing prices above solid technical resistance at $21.00. The next downside price objective for the bears is closing prices below solid support at $18.50. First resistance is seen at $20.00 and then at $20.50. Next support is seen at $19.50 and then at $19.00. Wyckoff's Market Rating: 3.5. Read More

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King dollar dominating gold, silver, but precious metals are ripe for a short squeeze

The U.S. dollar continues to dominate gold and silver as a 20-year high last week prompted hedge funds to liquidate their bullish bets and increase their bearish exposure.

However, analysts warn that profit-taking in the U.S. dollar could squeeze precious metal short sellers, which appears to be happening in the silver market as prices rally 6% at the start of a new trading week, testing resistance at $20 an ounce.

All eyes are currently on silver as the precious metal sees its best daily gain in a year. The rally in silver comes as hedge funds pushed their bearish bets to a three-year high.

"The King Dollar's reversal is catalyzing a ferocious short squeeze in silver. After all, with money manager's short positioning in silver having grown to its highest levels since 2019, a consolidation lower in the USD has sent participants rushing for the exits," said commodity analysts at TD Securities, in a report Monday. Read More

Stock market is key for gold price right now, here's why

Gold's next rally might depend on the stock market and how fast it can deflate as the Federal Reserve tightens its monetary policy, said Bloomberg Intelligence.

The stock market is a crucial metric for gold since the trend of its outperformance versus gold might be reversing, Mike McGlone, senior commodity strategist at Bloomberg Intelligence, wrote in a note Monday.

"A top potential force for the Federal Reserve to lighten up on tightening -- which is gold resistance -- is a deflating stock market," he said. "An elongated period of gold underperformance and stock market outperformance may be reversing. This narrative from 2000 is gaining traction in 2022. The metal is down about 6% vs. about a 15% decline for the S&P 500 to Sept. 9."

The story is different in other currencies. Gold has climbed around 7% and 17% in the euro and yen, respectively. "The metal has made new highs in other major currencies, which is typically a precursor for similar behaviour in dollars," McGlone added.

The gold- to-S&P 500 ratio bottoming could be the trigger gold needs. "The Fed started easing in 2001 as equities deflated and helped to buoy gold. We see parallels brewing in 2022," McGlone pointed out. Read More

Federal Reserve’s rate decision will factor in the August CPI report

According to forecasts, tomorrow’s CPI report could reveal a mixed message. There is a unanimous consensus that tomorrow’s report will show a decrease in inflationary pressures. However, the core CPI forecast which strips out energy and food costs is expected to climb from 5.9% to 6.1% year-over-year. There is also a consensus that lower levels of inflation are unlikely to change the decision of the Federal Reserve next week to raise rates by another three-quarter of a percent.

According to Bloomberg Economics, “The ‘totality’ of the data that Fed Chair Jerome Powell will follow shows few signs of cooling in the economy, and perhaps even some acceleration.”

Image Source: Kitco News

Nonetheless today we saw both the dollar and yields on U.S. debt instruments soften and the precious metals gain value across the board. As of 5:35 PM EDT gold futures basis, the most active December Comex contract is currently fixed at $1735.40 which is a net gain of $6.80 on the day or 0.39%. Silver had the strongest performance amongst the precious metals gaining 5.34% or $1.00 taking the most active September futures contract to $19.77. Read More

Image Source: Kitco News

Gold and silver trade marginally lower ahead of the European open

Gold (-0.07%) trades marginally lower but silver is almost down half a percent leading into the European open. Elsewhere in the commodities complex, copper (0.11%) and spot WTI (0.29%) are trading higher. 

Indices in the Asia Pac area moved higher overnight as they took the lead from Wall St. The Nikkei 225 (0.25%), ASX (0.65%) and Shanghai Composite (0.04%) all closed in positive territory. Futures in Europe are indicating a positive open. 

FX markets were pretty quiet compared to recent sessions. The biggest mover was GBP/USD which rose 0.22%. In the crypto space, BTC/USD is trading at $22,309.

News from overnight and this morning: 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.