Today's Gold and Silver News - 15th November

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Gold Slips From 3-Month High After Fed Governor’s Cautionary Note

Gold slipped back from its highest level in three months following cautionary comments from Federal Reserve Governor Christopher Waller that policymakers had “a ways to go” before ending interest-rate hikes.

The Governor’s comments gave the US Dollar a boost with gold falling slightly due to the precious metal’s typically inverse correlation with the greenback. The remarks also served as a reminder that gold’s huge gains last week were driven by sentiment that the Fed will be less aggressive with its future upcoming interest rate decisions rather than on any firm fact. Read More

Silver Shrugs Off Strengthening Dollar to Remain Near June High

Silver continues to trade near its highest level since June even with today’s slight dip caused by a strengthening US Dollar.

Silver has enjoyed a turnaround in fortunes with investors now looking for reasons to drive the price higher after months in which every piece of macroeconomic data was viewed negatively for the precious metal. 

Federal Reserve Governor Christopher Waller’s comments over the weekend reminded investors that the US is far from out of the inflation woods and that the US central bank is still some way off stopping increasing its benchmark interest rates. The fact that this has only caused the smallest of dips in silver’s price underlines the change in sentiment for the metal. Read More

Economic outlook turns 'gloomier' than the IMF's October estimate

With the economy starting to slow, the outlook is now 'gloomier' than what the International Monetary Fund (IMF) projected in its October report.

The IMF is now focused on the fourth quarter outlook, with early data points suggesting more weakness ahead.

"The macroeconomic policy environment is unusually uncertain … Our latest World Economic Outlook, released last month, lowered our global growth forecast for next year to 2.7 percent, and we expect countries accounting for more than one-third of global output to contract during part of this year or next," IMF's economist Tryggvi Gudmundsson said Monday in a blog post. "Moreover … recent high-frequency indicators confirm that the outlook is gloomier."

The IMF's concern comes from what looks like a steady worsening of the purchasing manager indices (PMI) in recent months, Gudmundsson explained. The trend is especially visible when looking at the G20 economies.

"These survey-based measures gauge the momentum of manufacturing and services activity," Gudmundsson said. "A growing share of G20 countries have fallen from expansionary territory earlier this year to levels that signal contraction. That is true for both advanced and emerging market economies, underscoring the slowdown's global nature." Read More

Gold, silver higher as bulls step in to buy early dips

Gold and silver prices are firmer in midday U.S. trading Monday, with gold scoring a 2.5-month high. Bullish traders stepped in to buy the early price weakness today. However, gains in the precious metals were limited by a rebound in the U.S. dollar index and rising U.S. Treasury yields to start the trading week. December gold was last up $4.00 at $1,773.40 and December silver was up $0.368 at $22.03.

U.S. stock indexes are mixed at midday, on corrective price action following recent strong gains. The S&P 500 stock index on Friday hit a two-month high and the Nasdaq index notched a six-week high. The S&P 500 is trending higher on the daily bar chart, to suggest that a market bottom is in place and that prices can continue to work sideways to higher in the near term.

There was no major U.S. economic data released Monday. The pace picks up quickly Tuesday, including the release of the producer price index report for October, which is seen coming in at up 0.4% from September and compares to the rise of 0.4% in the September PPI report.

Technically, December gold futures prices hit a 2.5-month high today. The gold futures bulls have the slight overall near-term technical advantage. Bulls have momentum and are working on a fledgling price uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,800.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the November low of $1,618.30. First resistance is seen at $1,800.00 and then at the August high of $1,824.60. First support is seen at $1,750.00 and then at $1,738.70. Wyckoff's Market Rating: 5.5.

Image Source: Kitco News

December silver futures prices last Friday hit a 4.5-month high. The silver bulls have the overall near-term technical advantage and have momentum. Prices are in a choppy 2.5-month-old uptrend on the daily bar chart. 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 $20.00. First resistance is seen at last week’s high of $22.16 and then at $22.50. Next support is seen at today’s low of $21.37 and then at $21.00. Wyckoff's Market Rating: 6.5. Read More

Image Source: Kitco News

Gold recovers from lows even with Fed Governor Waller's hawkish warning

Federal Reserve Governor Christopher Waller told a conference in Sydney, Australia today, "We're not softening...Quit paying attention to the pace and start paying attention to where the endpoint is going to be. Until we get inflation down, that endpoint is still a way out there."

Gold traded to a low of $1762 at approximately 8:13 PM EST. This morning’s decline was the result of both dollar strength and a warning by Christopher Waller that the Federal Reserve’s monetary policy was not wavering from its strong commitment to continue to use rate hikes to fight against persistent inflation. On Sunday speaking at a conference sponsored by UBS Waller said that although the central bank is looking at the possibility of a slower pace of raising interest rates, this consideration should not be interpreted as a softening in its fight for price stability.

Image Source: Kitco News

As of 3:33 PM, EST gold futures basis most active December 2022 contract is trading up $6.60 or 0.37% and fixed at $1776. This is just a few dollars off today’s high of $1778.40. Today’s gains in gold futures are occurring concurrently with dollar strength which has made today’s moderate gains even more impressive. Today the dollar index has gained +0.42% and is currently fixed at 106.605. After trading to a low of 106.20 on Friday the dollar has had a fractional recovery from those lows. Read More

A fundamental shift is driving gold prices closer to $1,800 - MKS' Shiels

Gold's new bullish momentum is more than just technical market repricing; the precious metal's ability to hold new critical support levels could indicate a longer-term fundamental shift, according to one market analyst.

In a recent note to clients, Nicky Shiels, head of metals strategy at MKS PAMP, said that the biggest factor supporting gold's new uptrend is shifting investor expectations regarding the Federal Reserve's monetary policy. Although the Federal Reserve will continue to raise interest rates through the early part of 2023, the pace is expected to slow down. At the same time, inflation pressures will remain elevated.

According to the CME FedWatch Tool, markets firmly expect the U.S. central bank to raise the Fed Fund’s rate by 50 basis points next month.

"Fed has shifted from being too late (and then too fast with super-sized rate hikes), and now with midterms behind us, they are not going to be able to hike enough to bring inflation sustainably lower," said Shiels. "It's a higher inflation regime for longer, with a relatively slower Fed."

Although gold's path won't be a straight line to $1,800 an ounce, that target is starting to materialize, she said. The gold market has managed to hold on to last week's gains, its best performance in roughly two years. December gold futures last traded at $1,771.80 an ounce, up 0.14% on the day.

"Overall, it’s likely precious pulls back, but it's an opportunity to re-engage and add length to capitalize on a new bull market trend," she said. "Yes, gold has the uncanny ability to consistently disappoint, but when major technical breakouts are aligned with major Fed policy pivots, that should be respected." Read More

The Fed committed 'serious mistake' and it could push economy into 'Great Depression' - Ark's Cathie Wood

The Federal Reserve is ignoring deflationary signals in the economy. And its heavy-handed rate hikes could be pushing the economy into something similar to the Great Depression, said Ark Invest CEO Cathie Wood.

Deflationary signals are already strong, and the setup looks akin to the Roaring Twenties one hundred years ago.

"Prior to the Roaring Twenties, the world was at war - WWI - and suffering a pandemic - Spanish Flu. While both had a more serious impact on the global economy, today's combination is a strong echo that could result in much lower than expected inflation and a boom in innovation," Wood said in a Twitter thread. "The setup is remarkably similar [to today]!"

The 1920s was the time when "several general purpose technologies evolved at the same time," including the telephone, electricity, and the internal combustion engine, Wood pointed out. 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.