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Gold Price News: Gold Remains Close to $2,000 on Banking Sector Fears
Investor interest in gold remains elevated amid growing fears about the stability of the banking sector.
The EuroStoxx Banks index, which tracks the major EU and UK banks, lost another 2% on Friday and is now down almost 20% from the recent peak reached in February.
Additionally, the price of the CDS (credit default swap, the price for insuring against a default event) related to Deutsche Bank jumped to a new high, suggesting that the recent episodes of banking troubles, with the default of Silvergate Bank and Silicon Valley Bank, followed by the dramatic acquisition of Credit Suisse by UBS, could lead to a wider sector crisis.
The immediate and natural answer for many investors and portfolio managers has been purchasing gold, in order to mitigate the risk. Read More
Silver Price News: Double-digit Growth Trend Remains Positive
The silver price closed last week up by 4.5%, and its monthly performance shows a double-digit growth (+13%), outperforming gold (+9%).
While the ECB, the Fed and the BoE all recently increased rates, investors are already looking ahead to the next steps in monetary policy.
The new element in the market is represented by the growing risks perceived in the whole banking sector. Of course, there could be an overreaction, but European banks’ stocks have plummeted by 18% in just three weeks and investors are betting on the precious metal as a safe haven in case of new market turmoil.
The modest decline seen in the last few hours is a technical reaction to the rebound seen in the stock markets. Read More
'That's why you own gold': Investors get rewarded as gold kicks off two-year cycle, says VanEck CEO
A situation like the banking crisis is why people own gold and precious metal investors are getting rewarded, said VanEck Associates CEO Jan Van Eck, who sees a new two-year bull rally beginning in the gold space.
Gold is up more than 7% on the month, with June Comex gold futures last trading at $1,977, down 1.23% on the day. After testing $2,000 an ounce, there is some profit-taking happening as risk sentiment sees a slight improvement at the start of the trading week.
But the outlook for gold in the next two years remains solidly bullish, according to Van Eck.
"We are at the very beginnings of what could be a several-year cycle in gold. I also put Bitcoin in that category. Finally, as a gold investor, you've been rewarded over the last couple of weeks. Weakness in the banking system and gold rallied. That's why you own gold," Van Eck told CNBC.
The two-year bull cycle will be driven by the Federal Reserve ending its tightening and markets getting stressed out by the consequences of higher rates. And the end scenario for this environment will be the Fed cutting rates again. Read More
Gold, silver down as risk appetite slightly up
Gold prices are solidly lower and silver modestly down in midday U.S. trading Monday. Both metals’ prices are up from their daily lows, however. Less risk aversion in the marketplace early this week is prompting profit-taking and weak long liquidation from the futures traders. April gold was last down $24.80 at $1,959.00 and May silver was down $0.189 at $23.15.
Global stock markets were mostly higher overnight. U.S. stock indexes are mixed at midday. Risk appetite is slightly keener Monday and that’s a negative for the safe-haven metals. The U.S. and European banking systems appear to have stabilized, at least for the moment. First Citizens Bancshares has agreed to buy pieces of Silicon Valley Bank. Meantime, Deutsche Bank shares are firmer today amid easing fears for that bank’s health.
Technically, April gold futures bulls still have the firm overall near-term technical advantage. Prices are still in an uptrend on the daily bar chart, but now just barely. Bulls’ next upside price objective is to produce a close above solid resistance at the March high of $2,014.90. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,900.00. First resistance is seen at $1,975.00 and then at today’s high of $1,984.00. First support is seen at today’s low of $1,945.00 and then at last week’s low of $1,936.50. Wyckoff's Market Rating: 7.4.
Image Source: Kitco News
May silver futures bulls have the firm overall near-term technical advantage. Prices are in a steep uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $24.00. The next downside price objective for the bears is closing prices below solid support at $22.00. First resistance is seen at today’s high of $23.485 and then at last week’s high of $23.705. Next support is seen at $23.00 and then at $22.50. Wyckoff's Market Rating: 6.5. Read More
Image Source: Kitco News
Gold prices soften as concern subsides over banking meltdown
For the second consecutive day gold futures have traded lower. Today gold traded to an intraday low of $1945 and a high of $1984 after opening at $1982.60. As of 4:15 PM EST gold futures basis the most active April contract is currently fixed at $1958.50 after factoring in today’s decline of $25.30 or -1.28%.
Today’s decline of approximately 1.3% was the direct result of traders bidding the precious yellow metal lower, with dollar weakness providing tailwinds that softened the decline today. Dollar weakness also provided some relief for spot gold which is currently fixed at $1956.90 after factoring in a decline today of $21.30. However, before factoring in dollar weakness spot gold was trading lower by $26.60 with dollar weakness adding back $5.30 per ounce.
The primary factor that had increased demand for the precious metal diminished over the weekend. The concern was centred around a banking crisis involving Silicon Valley Bank and Signature Bank of New York spreading to other banks. Read More
Silver shines in Paris Fashion Week as retailers see solid jewelry demand through 2023
Silver is again in vogue among the European haute couture fashion houses; the bold look comes as the Silver Institute said that silver has become an important fashion accessory among retailers, which should continue supporting demand and prices through 2023.
According to fashion commentators, Paris Fashion Week, which wrapped up at the start of the Month, continued to feature a lot of unique mixed metal, gold and silver jewelry.
According to freelance fashion journalist Milena Lazazzera, some of the biggest names in jewelry have created a "cult status" for their two-tone pieces.
One of Italy's most exclusive jewelry brands, Bucelllati intertwines gold, silver and white gold in its Ramage collection. Read More
Is the gold price sustainable at $2,000 as the short-squeeze runs its course?
Gold's push above $2,000 was primarily driven by short covering, according to the latest data from the Commodity Futures Trading Commission. However, growing safe-haven interest as the world faces the biggest banking crisis since 2008 could create sustainable bullish momentum, according to some analysts.
The latest and up-to-date trade data from the CFTC comes nearly a month after reporting was disrupted because of a ransomware attack on ION Trading UK. According to reports, about 20% of CME Group clearing members were affected by the cyberattack.
With the trade data back on track, commodity analysts note the growing potential for a sustained rally in gold as speculative bullish interest remains well below historical levels.
"Compared with the last time gold traded at $2000 last year in March, the 107k lots net-long is 40% below the length held back then, highlighting the prospect for more buying should the technical and fundamental outlook continue to support," said Ole Hansen, head of commodity strategy at Saxo Bank.
However, Hansen also noted that investors might be reluctant to chase the market as prices test resistance at $2,000 an ounce, which has proven to be a formidable barrier. Read More
Gold price settles above $1,950 as markets look to this week's testimonies on bank failures
Gold settled about $50 below the $2,000 an ounce level on Monday as markets looked towards Washington to increase confidence in the banking sector with back-to-back hearings examining recent bank failures in the U.S.
After testing the $2,000 level a few times last week, gold retreated and settled at above $1,950 on Monday as risk sentiment improved.
However, markets remain worried about the state of the banking sector in the U.S., which is why all eyes are on the two House and Senate committees hearing Tuesday and Wednesday that will aim to boost confidence in the banking sector and examine regulatory failures that led to the collapse of Silicon Valley Bank and Signature Bank.
The witness list includes Federal Reserve Vice Chair for Supervision Michael Barr, Federal Deposit Insurance Corp. (FDIC) Chairman Martin Gruenberg, and Treasury Undersecretary for Domestic Finance Nellie Liang.
Barr's testimony, released on Monday, blamed the banking failures on a "textbook case of mismanagement." He added that the banking system is "strong and resilient."
"We will continue to closely monitor conditions in the banking system and are prepared to use all of our tools for any size institution, as needed, to keep the system safe and sound," Barr said. "Our first step is to establish the facts—to take an unflinching look at the supervision and regulation of SVB before its failure. This review will be thorough and transparent, and reported to the public by May 1." Read More
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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.
