Today's Gold and Silver News - 22nd November

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Gold Price News: Gold Back Below $1,750 on Reality of Further Fed Hikes

Gold has slipped back below $1,750 an ounce after a range of recent comments by Federal Reserve officials reminded investors that further interest rate increases are still likely in the coming months and talk of a pivot is premature.

Gold has still managed to hold onto the bulk of impressive gains earlier in the month, as while traders may be reappraising their interest rate curves in the light of the reality checks delivered by Fed officials, the fallout across the crypto sector has kept gold supported. Read More

Silver Price News: Silver Short-Term Slide Continues Under Pressure From Stronger Dollar

Silver’s short-term slide continues with the precious metal now trading comfortably below $21 an ounce as a stronger US dollar alongside concerns over the impact the recent Covid deaths in China will have on the global economy weighed on sentiment.

Once again, silver is illustrating how vulnerable it is to the words and actions of the Federal Reserve and its officials as the latest decline has been prompted by a reappraisal of how much longer the US central bank will keep on raising interest rates for. A rally earlier in the month was prompted by the prospect of the Fed slowing its hikes as soon as the start of next year, but recent comments from Fed officials suggest that any pivot on policy is some way off yet. Read More

Gold, silver down as USDX rallies, crude oil tanks

Gold and silver prices are solidly lower in midday U.S. trading Monday. The metals are feeling the heat of strong gains in the U.S. dollar index to start the trading week and a big drop in crude oil prices. December gold was last down $20.00 at $1,734.30 and December silver was down $0.302 at $20.70.

The key outside markets today see the U.S. dollar index in a strong rebound, including sharply higher prices today, after the index hit a three-month low last week. Nymex crude oil prices are sharply down today and hit a 10.5-month low. News wire reports today said Saudi Arabia is considering a modest increase in its crude oil production. The yield on the benchmark U.S. 10-year Treasury note is presently 3.819%.

Technically, the gold futures bulls have lost the slight overall near-term technical advantage. A fledgling price uptrend on the daily bar chart has stalled out. Bulls’ next upside price objective is to produce a close above solid resistance at the November high of $1,791.80. 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 today’s high of $1,755.00 and then at $1,770.00. First support is seen at $1,725.00 and then at $1,700.00. Wyckoff's Market Rating: 5.0.

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The silver bulls still have the slight overall near-term technical advantage but are fading. 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 the November high of $22.38. The next downside price objective for the bears is closing prices below solid support at $19.00. First resistance is seen at today’s high of $21.04 and then at $21.50. Next support is seen at $20.50 and then at $20.00. Wyckoff's Market Rating: 5.5. Read More

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Gold and silver need more than short covering, hedge funds still reluctant to place bullish bets

Speculative positioning in the precious metals market has become significantly less bearish in recent weeks as hedge funds mostly covered their short bets. However, the market is still unable to attract enough bullish interest for a sustained rally.

While gold and silver continue to hold solid gains above their recent multi-year lows, some analysts have said that the precious metals will continue to struggle as the Federal Reserve maintains its aggressive monetary policy stance.

Although the U.S. central bank is expected to slow to a 50-basis point hike next month, the end target of an elevated terminal rate above 5% remains firmly in place.

"Economic conditions in the United States still are relatively healthier than most other major regions around the world," said commodity analysts at CPM Group. "This could provide support to the U.S. dollar and consequently weigh on gold prices in the short term." They are recommending investors remain neutral on gold in the near-term.

Some analysts have noted that the latest data from the Commodity Futures Trading Commission shows sentiment improving in gold and silver, but they believe that more needs to be done to create a sustainable bullish uptrend. Read More

Physical silver demand to hit record highs but ETF outflows dominate the price action

Weak investment demand for paper silver products and exchange-traded funds have pushed prices into a steep downtrend through most of 2022.

However, despite the weak price action, there is fundamental strength in the precious metal as physical demand looks to end 2022 at record levels, according to the latest report from the Silver Institute.

In an interim report published last week as part of the Annual Silver Industry Dinner in New York, the Silver Institute said that global silver demand is expected to hit a new record of 1.21 billion ounces this year, rising 16% from 2021.

“Each key segment of demand, except photography, is set to post a new peak,” said the analysts at Metals Focus, the author of the latest report.

In a breakdown of the silver market, the British research firm said that industrial demand is forecasted to grow to 539 million ounces this year. Industrial demand continues to be driven by the global green energy transition, growing demand for electric vehicles, and increased adoption of 5G technologies.

At the same time, physical investment demand is expected to rise to 329 million ounces, increasing by 18% compared to last year. There has been an insatiable appetite for silver bullion products, with premiums on coins rising to record levels, hitting nearly 100%.

“Support has come from investor fears of high inflation, the Russia-Ukraine war, recessionary concerns, mistrust in government, and buying on price dips,” the report said. Read More

Market sentiment for gold adjusts to recent Fed officials' comments

Market sentiment is overly sensitive to statements and comments made by Federal Reserve officials because those individuals have the power and influence to change monetary policy. There is a dramatic difference between the perception of upcoming Federal Reserve monetary policy changes and the actions of Federal Reserve officials.

The Federal Reserve raised rates at every FOMC meeting this year except in January, from March through November, a total of six rate hikes. Over the last four FOMC meetings (June, July, September, and November) they raised rates by 75 basis points. The aggressive nature of the Federal Reserve’s monetary policy moved gold dramatically lower from March up until the beginning of November. Gold traded to its highest value this year of $2078 in March. By the beginning of November, gold prices had dropped to approximately $1621, resulting in a price decline of 21.99%.

Image Source: Kitco News

During the first week of November, market sentiment shifted because inflation rates had declined fractionally and investors viewed this fractional drop as a signal that the Federal Reserve would begin to loosen its aggressive monetary policy. This caused gold to rise dramatically from $1621 to an intraday high of $1792 by Tuesday, November 15. Because the CPI index dropped from 8.2% year-over-year in September to 7.7% year-over-year in October investors believed that the Federal Reserve would become more dovish regarding upcoming rate hikes. 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.