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Gold Price News: Gold Ends Higher to Pare Weekly Losses
Gold prices were marginally higher on Friday, ending the week in an upward trend, and partly regaining ground lost earlier in the week.
Prices spent most of the morning at around $2,005 an ounce, and barring a brief drop to $1,995 an ounce, prices held their ground to trade at $2,005 to $2,010 by late afternoon.
The modest gains followed a strong day on Thursday, when gold rebounded from Wednesday’s intra-week low of $1,985 an ounce.
US producer prices were released Friday, showing an increase of 0.3% in January, larger than the market’s expected 0.1% rise. And core PPI figures, which exclude food and energy, which tend to be volatile, showed a larger rise of 0.5%, versus market expectations of a 0.1% increase. Inflation figures matter because they add pressure on central banks to maintain higher rates for longer, a negative factor for non-interest-bearing assets like gold. Read More
Silver Price News: Silver Hits 6-Week High As Dollar Weakens
Silver prices staged a three-day-long rally to reach a six-week high on Friday, rising along with strength in the gold price seen in the second half of the week.
Prices reached a high of $23.54 an ounce in late deals Friday, compared with around $23.00 an ounce late Thursday and from a low of just below $22.00 on Wednesday.
The strong rebound for silver came as gold prices showed a partial recovery from a sharp drop seen on Tuesday.
The US dollar weakened against other major currencies towards the end of the week, providing a supportive element for dollar-denominated assets like gold and silver.
This effect of currencies appeared to trump other factors on Friday, which were marginally bearish for precious metals. US producer prices for January showed a larger increase than market expectations, according to figures released Friday, lending weight to suggestions that the US Fed might need to keep interest rates higher for longer. Read More
The Metals, Money, and Markets Weekly February 16: Off the hook, by Mickey Fulp - Listen to the podcast
Ignore gold and focus on silver as prices rally 7% from support
Rising inflation pressures have taken their toll on the gold market. While a lot has been thrown at the precious metal, it continues to hold critical support, at least for now, according to some analysts.
Although gold is ending its second week in negative territory, it is entering the weekend well off its lows after holding critical support at $2,000 an ounce. April gold futures last traded at $2,025.60 an ounce, down 0.64% from last Friday.
Analysts note that gold has struggled as hotter-than-expected consumer and producer prices force investors to push back the start of the Federal Reserve's easing cycle. Markets see only a 10% chance of a March rate cut; at the same time, the CME FedWatch Tool shows markets see only a 33% chance of a move in May. However, there are still solid expectations that the U.S. central bank could start easing interest rates in June.
Ole Hansen, head of commodity strategy at Saxo Bank, said that although gold could see further selling pressure in the near term, he remains bullish in the long term. Read More
Analysts doubt gold’s strength next week, retail traders don’t stop believing
As expected, the gold market got its direction from inflation data this week, with the only major move being the sharp price decline on Tuesday morning following hotter-than-expected CPI data for January, which drove spot gold from just under $2,030 per ounce in the minutes before the 8:30 am EST release all the way to $1,991 an hour and a half later.
After that, prices largely traded within a narrow $12 channel on both sides of the $2,000 level until Friday morning’s PPI release caused another smaller selloff. This was followed by a sharp if shallow rebound, after which prices climbed steadily into the President’s Day long weekend.
The latest Kitco News Weekly Gold Survey showed Wall Street and Main Street diverging once again in their price expectations, with a large proportion of retail investors seeing potential gains next week, while analysts see a strong case for precious metal prices to slide.
“April gold posted a bearish breakout of its previous short-term sideways trend this week, extending its intermediate-term downtrend to a low of $1,996.40 (so far),” said Darin Newsom, Senior Market Analyst at Barchart.com. “At the same time, the long-term uptrend of the US dollar index is gaining momentum. The next downside target for April gold is $1,970.50.” Read More
Gold prices benefiting from geopolitical uncertainty, silver prices see some profit taking
Thin holiday trading with North American markets closed for holidays is creating some volatility in the precious metals market, with gold prices benefiting and silver prices suffering.
U.S. markets are closed in recognition of President’s Day, and major Canadian exchanges in Ontario are closed for Family Day. In the low liquidity environment, gold continues to recover from last week’s selloff after testing support at $2,000 an ounce. April gold futures last traded at $2,028.30 an ounce, up 0.20% on the day.
Image Source: Kitco News
At the same time, silver is seeing some significant selling pressure as prices were unable to hold critical psychological support above $23.50 an ounce. Silver prices last traded at $23.110 an ounce.
Image Source: Kitco News
Some traders note that silver could see some profit-taking after last week’s strong recovery. After testing support at $22 an ounce, silver managed to end last week with a 7% rally off its lows.
Although gold is starting the shortened trading week with a modest gain, some analysts have pointed out that it remains stuck in a well-defined trend with support at $2,000 and resistance around $2,050 an ounce.
With gold going nowhere anytime soon, some analysts have said that silver is the key metal to watch in the precious metals space. Read More
Bitcoin ETFs are not competing with gold as the precious metal holds above $2,000
Reminiscent of 2019, the debate between gold and Bitcoin rages anew as the two assets see a stark contrast in investment demand.
In January, the Securities and Exchange Commission, in a long-awaited move, approved the launch of 11 spot Bitcoin-backed exchange-traded products. Since then, the crypto-backed ETFs have seen inflows of more than $4 million.
At the same time, global gold-backed ETFs have seen investment outflows of more than $3 billion since the start of the year. Specifically, SPRD Gold Shares (NYSE: GLD), the world’s largest gold-backed ETFs has led the exodus in the precious metals market.
However, some commodity analysts warn investors not to read too much into this trend, as the negative correlation is not causation. Some analysts point out that gold’s selloff started long before the approval of the Bitcoin ETFs. As February quickly comes to a close, gold ETFs are expected to see nine months of consecutive outflows. Read More
Inflation fears force hedge funds to ditch gold, increase bearish bets in silver
Gold and silver continue to defy the odds as the precious metals hold critical support even as inflation fears prompted hedge funds to liquidate their bullish positionings and increase their speculative bets, according to the latest trade data from the Commodity Futures Trading Commission.
Commodity analysts at Société Générale noted that the gold market led speculative outflows in the commodity space last week, as $6.9 billion fled the precious metal.
The CFTC's disaggregated Commitments of Traders report for the week ending Feb. 13 showed money managers decreased their speculative gross long positions in Comex gold futures by 13,674 contracts to 100,642. At the same time, short positions increased by 20,219 contracts to 66,466 contracts.
The gold market is now net long by only 34,176 contracts as bullish speculative positioning falls to its lowest level since Oct. 16. Although bullish interest in gold continues to weaken, the price continues to hold critical support at $2,000. Read More
Live From The Vault - Episode: 160
We’re living in a fiat experiment - Feat. Peter Krauth
In this week’s episode of Live from the Vault, Andrew Maguire is joined by a popular guest request: Peter Krauth, Author of Great Silver Bull and editor of the Silver Stock Investor newsletter, to explore the rich history of silver as money.
The precious metal experts evaluate the current price of silver and analyse how the precious metal may be impacted by the gold price reevaluation, shedding light on what’s driving the massive outflows and industrial demand silver is seeing right now.
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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.
