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Silver Price News: Silver Climbs on Weaker Dollar, Prospect of Dovish Fed
Silver has finally had some light relief with the price climbing back towards $21 an ounce with the US dollar much weaker and the prospect of a more dovish Federal Reserve following the collapse of Silicon Valley Bank.
While silver’s gains haven’t been as impressive as those for its precious metal peer, it has at least managed to reverse the downward trend that had seen it slide from close to $24 at the start of February down to just above $20 an ounce last week.
Next week’s interest rate decision by the Fed now takes on even greater significance than it already had with the markets desperate to know how the US central bank will respond after the hit to its financial system following Silicon Valley Bank’s failure. Read More
Gold Price News: Gold Surges Close to $1,900 From Haven-Seeking Investors
Gold has been one of the few beneficiaries from the collapses of first Silvergate and then Silicon Valley Bank, with the precious metal’s safe-haven appeal seeing its price surge to close to $1,900 an ounce.
The failure of Silicon Valley Bank in particular raised contagion fears, resulting in the US dollar weakening significantly and dialling back expectations on how much higher the Federal Reserve will hike interest rates. Given gold’s inverse correlation with the dollar and its lack of yield often seeing it struggle during times of rising rates, the conditions for gold have dramatically improved in a matter of days.
Suddenly, far from seeing $1,800 as an important support level, now the question is whether gold has sufficient momentum to break through $1,900 an ounce with the price already at its highest level for 6 weeks. Read More
Gold market holding gains but unable to break above $1,900 as U.S. government looks to contain bank failures by guaranteeing depositors remain whole
The gold market is holding on to solid gains Sunday evening after a strong open driven by growing concerns that the U.S. banking sector is on the verge of another financial crisis.
The gold market is trading near a five-week high, even as prices have fallen from their session highs, a hair's breadth away from $1,900 an ounce. April gold futures last traded at $1,881.40 an ounce, up 0.76% on the day.
Financial market headlines have been fairly fluid Sunday evening as markets opened to news of another commercial bank, New York-based Signature Bank, which was closed and taken over by the Federal Deposit Insurance Corporation (FDIC). This was the latest bank failure after the FDIC took control of Silicon Valley Bank on Friday, the biggest bank failure since the 2008 Great Financial Crisis.
As contagion risks spread, U.S. regulators have quickly stepped up to stabilize markets and reassure jittery consumers. The Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve, in consultation with President Joe Biden, announced that depositors at SVB and Signature would be made whole.
"Today we are taking decisive actions to protect the U.S. economy by strengthening public confidence in our banking system," U.S. Treasury Secretary Janet Yellen, Fed Chair Jerome Powell and FDIC Chairman Martin Gruenberg said in the joint statement. "This step will ensure that the U.S. banking system continues to perform its vital roles of protecting deposits and providing access to credit to households and businesses in a manner that promotes strong and sustainable economic growth." Read More
Market participants need to keep a close eye on U.S. Treasuries
U.S. President Biden has just made a television appearance in an attempt to calm very jittery stock and financial markets. However, at the same time, Biden spoke about the U.S. Treasury bond and noted futures markets’ prices are soaring higher on flight-to-quality buying of U.S. government debt. During times of very keen trader anxiety, the U.S. Treasury markets are considered to be the supreme safe-haven sanctuary for many traders and investors. Gold prices are also seeing strong safe-haven demand and are at a five-week high, above $1900 an ounce. Meantime, crude oil prices are tanking and hit a three-month low on worries the U.S. financial crisis will crimp global economic growth. The U.S. dollar index has also sold off sharply in the past two trading sessions.
Over the next couple of days, the most important market for traders of all markets to watch is the U.S. Treasury market. An old adage in the marketplace says that bond traders are the smartest guys/gals in the room. Read More
Gold price surges above $1,900 as U.S. grapples with banking turmoil, Biden seeks to reassure the public
The gold market jumped above $1,900 an ounce as U.S. markets reacted to the growing banking turmoil after the collapse of Silicon Valley Bank and Signature Bank.
The precious metal attracted investors as the equity market tumbled, the U.S. dollar index dropped, and the U.S. Treasury yields fell. The two-year U.S. Treasury yield posted the biggest one-day drop since 1987 and was last at 4.12%
U.S. President Joe Biden made an urgent appearance to reassure the markets that the U.S. banking system is "safe" and seeking stronger bank regulations.
"Americans can have confidence that the banking system is safe. Your deposits will be there when you need them," Biden said Monday. "I'm going to ask Congress and the banking regulators to strengthen the rules for banks to make it less likely this kind of bank failure will happen again, and to protect American jobs as a small business."
Fears of a full-blown banking crisis and re-pricing of future Federal Reserve rate hikes have driven gold above its critical psychological level of $1,900. Since Friday, the gold market has gained more than $70. April Comex gold futures were last at $1,909.20, up 2.26% on the day. Read More
U.S. banking worries rally gold, silver markets
Gold and silver prices are sharply up, with gold hitting a five-week high and silver a three-week high in midday U.S. trading Monday, on safe-haven demand amid a shaky general marketplace. April gold was last up $42.50 at $1,909.90 and May silver was up $1.419 at $21.92.
Trader and investor anxiety is elevated to start the trading week, following a turbulent weekend in the wake of late last week's collapse of Silicon Valley Bank, the sixteenth largest bank in the U.S. The federal government said it would back all depositors in the failed bank. Other smaller U.S. banks are reported to be under stress due to depositor withdrawals. Government regulators have also taken over Signature Bank, which serves many cryptocurrency companies.
To show how much this event has shaken the general marketplace, Goldman Sachs is now predicting the Federal Reserve will not raise U.S. interest rates at its FOMC meeting next week. Said one market analyst in a Wall Street Journal story today: “When the Fed raises rates so quickly, nine times out of 10, it breaks things. We may see more corporate failures; we may see more regional banks go under." Read a headline on Dow Jones Newswires: “Bank mayhem is now on the Fed's radar."
Technically, April gold futures prices hit a five-week high today. Safe-haven demand was featured. Bulls have gained the firm overall near-term technical advantage. Bulls'' next upside price objective is to produce a close above solid resistance at the February high of $1,975.20. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,850.00. First resistance is seen at today's high of $1,918.30 and then at $1,932.40. First support is seen at $1,900.00 and then at today's low of $1,875.70. Wyckoff's Market Rating: 7.0.
Image Source: Kitco News
May silver futures prices hit a three-week high today. The silver bulls have gained the slight overall near-term technical advantage. A five-week-old downtrend on the daily bar chart has been soundly negated. Silver bulls' next upside price objective is closing prices above solid technical resistance at $23.00. The next downside price objective for the bears is closing prices below solid support at the March low of $19.945. First resistance is seen at $20.25 and then at $22.50. Next support is seen at $21.395 and then at $21.00. Wyckoff's Market Rating: 5.5. Read More
Image Source: Kitco News
Gold prices soar as investors fearing more bank meltdowns move into safe havens
Gold has gained almost $100 in the last two days of trading. Gold futures basis most active April contract opened at $1835 on Friday and closed at $1867. Today gold opened at $1877 and as of 5:30 PM EST is currently fixed at $1917.30 after factoring in today’s gain of $50.10 or 2.66%.
Image Source: Kitco News
Gold’s dramatic rise is largely the byproduct of a potential banking crisis with two banks showing “systemic risk” according to bank regulators. California’s Silicon Valley Bank and Signature Bank of New York required immediate action over the weekend to protect depositors’ capital. The banking meltdown resulted in the two-year Treasury yields having the largest three-day decline since black Monday in 1987. Read More
Wild swings in Fed expectations can trigger $2k gold price, but washout could be 'vicious' - analysts
The gold market is attracting the safe-haven trade in a chaotic market environment amid growing fears of contagion from Silicon Valley Bank's (SVB) collapse. Markets are also reassessing interest rate hike expectations ahead of the Federal Reserve meeting on March 22.
There are two major drivers pushing the gold sector higher, Forex.com senior technical strategist Michael Boutros told Kitco News.
"There is the risk of contagion and the question whether the Fed can continue to tighten as aggressively as they were foreshadowing," Boutros said Monday. "This is helpful for gold."
Gold prices shot up to five-week highs after the SVB and Signature Bank shock and traded comfortably above the $1,900 an ounce level. And according to analysts, there is a lot more upside in the trade, but certain technical levels must be hit first.
"We're coming into the next major critical level, and that's $1,912-$1,918. That six-dollar range is critical because it is this year's high-day close and the 2021 high-day close. It's a pivotal region," Boutros pointed out.
At the time of writing, April Comex gold futures were trading at $1,917.80, up 2.71% on the day. Read More
Fed’s borrowed gold opens up the Abyss
In this week’s Live from the Vault, Andrew Maguire studies the aftermath of the Federal Reserve borrowing over 100 tons of physical gold from the BIS to sell it into the market, in an attempt to push back against the rising price of the precious metal.
As gold weaponisation takes a new turn, the London whistleblower tracks the footprints of the US-centric PSYOP operation that was cobbled together when Russia began reintroducing physical gold as a new trade settlement currency.
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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.
