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Sellers step in at $2000 gold
The congestion area between $1,980 and $2,000 in the gold market is manifesting as expected. The Gold/Silver ratio is right at support of the triangle presented last week.
A concrete breakdown with conviction would indicate an acceleration in bullish momentum; important to note, however, that the ratio is in an oversold condition, and there is a concrete possibility that the triangle is not done consolidating.
The chart below shows the daily time frame, going back to August 2021. Read More
Image Source: Kitco News
Gold holding critical support as USD hits two-year high and bond yields rise to nearly 3%
The gold market is seeing some technical selling pressure after testing resistance at $2,000; however, many analysts continue to see resilient strength in the precious metal despite growing headwinds from the U.S. dollar and rising bond yields.
Tuesday, the U.S. dollar index pushed above 101 points, hitting a new two-year high; meanwhile, the yield on 10-year notes is within striking distance of 3%, its highest level since mid-March 2018.
Gold has held critical support at around $1,960 an ounce despite these challenges. June gold futures last traded at $1,962 an ounce, down more than 1% on the day.
Ole Hansen, head of commodity strategy at Saxo Bank, noted although bond yields and the U.S. dollar are currently weighing on gold, they haven’t been much of a hindrance.
“Gold remains a ‘two step forward, one step back’ kind of market with today's weakness driven by profit taking following the rejection at $2k,” he said in a email to Kitco News. Read More
Gold, silver succumb to big drop in crude oil, rise in bond yields
Gold and silver prices are sharply lower in midday U.S. trading Tuesday, on a big downside price corrections after both metals hit five-week highs on Monday. Solid losses in the crude oil market and rising U.S. Treasury yields on this day also worked against the precious metals market bulls. June gold futures were last down $26.90 at $1,959.60 and May Comex silver was last down $0.775 at $25.37 an ounce.
Image Source: Kitco News
Technically June gold futures bulls still have the firm overall near-term technical advantage. Bulls' next upside price objective is to produce a close above solid resistance at $2,000.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,915.00. First resistance is seen at $1,972.50 and then at today’s high of $1,985.10. First support is seen at $1,950.00 and then at $1,940.00. Wyckoff's Market Rating: 7.0. Read More
Bank of America still sees gold price hitting record highs and silver price pushing to $30
The gold and silver are seeing some solid technical selling pressure after gold tested resistance at $2,000 an ounce at the start of the week. However, technical analysts at Bank of America Securities said that any dip in the price could be seen as a buying opportunity for both precious metals.
The gold market is currently trying to hold support at around $1,960 an ounce. But the analysts at BofA aren't too worried if that level breaks. In a report published Tuesday, the bank said that the precious metal remains on course to record all-time highs as long as prices stay above the trending average at $1,888 an ounce.
"We think the daily, weekly, and monthly timeframes still indicate higher gold prices this year. Therefore we like longs/buying dips near $1,940/50 for tactical trades and if above $1,888/oz for medium-term trades. Our measured move targets suggest $2,175/oz can still be seen," the analysts said. Read More
U.S. economy looks like country is at war already - Lyn Alden
"It looks like the U.S. is in a war now, because of our high national debt, super high inflation and a possible recession that could become a crisis. It's like wartime finance," explained Lyn Alden, Founder of Lyn Alden Investment Strategy. "Even though the U.S. is not at war with Russia, there are proxy and financial wars happening. There are supply chain and commodity
wars, and an actual kinetic war."
Alden spoke to David Lin, Anchor at Kitco News, about economic trends and inflation, at the Bitcoin 2022 Conference in Miami. Lyn Alden Investment Strategy is an investment research firm for retail and institutional investors. Read More
Hedge funds jump back into gold as inflation geopolitical risks rise
The latest trade data from the Commodity Futures Trading Commission shows Russia's ongoing war with Ukraine continues to push hedge funds into the gold market, even as the precious metal faces growing headwinds of tightening monetary policies worldwide, according to analysts.
The CFTC disaggregated Commitments of Traders report for the week ending April 12 showed money managers increased their speculative gross long positions in Comex gold futures by 16,924 contracts to 165,244. At the same time, short positions also rose but by only 1,526 contracts to 48,219.
Gold's net length now stands at 117,025 contracts, up 15% from the previous week. The increase ends a five-week decline in bullish bets. The gold price consolidated between $1,950 and $2,000 an ounce during the survey period.
According to analysts at Société Générale, $3 billion followed into bullish gold bets last week. The analysts said that the precious metal was, "supported by further sanctions on Russia and inflation risks despite a hawkish Fed tightening monetary policy." Read More
'Turning point' for the U.S. dollar is near, says billionaire 'Bond King' Jeff Gundlach
The U.S. dollar has been rising on the back of the Federal Reserve's aggressive rhetoric and geopolitical uncertainty. But the greenback's turning point could be fast approaching, according to DoubleLine Capital CEO Jeffrey Gundlach.
The USD is seeing renewed safe-haven demand, which has boosted the world's reserve currency but at the same time weighed on gold — also a safe-haven asset during a geopolitical crisis.
According to analysts, the USD is viewed by many investors "as the 'cleanest dirty shirt in the laundry.'"
The dollar index (DXY), a measure of the greenback against six other currencies, reached the highest level in more than two years on Tuesday, rising above 101. The DXY was last at 100.93.
After seeing solid moves in the U.S. dollar, Gundlach reiterated his views that he is bullish on the dollar in the short term and a steadfast bear in the long term, noting that the greenback's turning point is approaching.
"My USD view's been clear & unwavering for a year now: Bullish short-run (six months to a year) and bearish long-run (two years plus). Inexorably the long run prevails. Yield curve now steepening & twin deficits still outrageous. USD headwinds building so turning point nearing," he tweeted. Read More
Will the Fed raise its inflation target? Here's what that means for gold price and crypto, says El-Erian
When it comes to inflation, the Federal Reserve has miscalculated, and the only way out might be for the central bank to raise its inflation target from 2% to 3%, said Allianz chief economic advisor Mohamed El-Erian.
The Federal Reserve has waited too long to respond to problematic price pressures.
"It's not going to be an easy way out, and it is going to be incredibly controversial. But that's what you get when you wait too long to recognize what inflation is and to take action. We should have started QT [quantitative easing] last year. We didn't. And now we bear the consequences of the Fed being so late," El-Erian told CNBC Monday.
What this will mean for the gold and crypto markets is that "they both go higher in a world like that," he explained.
Gold is a well-known inflation hedge, and it is up 6.5% year to date. Earlier in the week, the precious metal was up around 9% since January after prices briefly breached the $2,000 an ounce level. At the time of writing, June Comex gold futures were last at $1,951.10, down 1.78% on the day. Read More
Gold and silver move lower ahead of the European open
After a tough start to the week, gold is trading another 0.50% lower heading into the European open. Silver is also 0.82% weaker. In the rest of the commodities complex, copper is 0.34% in the red, and spot WTI is half a percent lower too.
Risk markets in the Asia Pac area were mixed. The Nikkei 225 (0.86%) and ASX (0.05%) both traded higher but the Shanghai Composite fell 1.47%. Futures in Europe are pointing towards a positive cash open.
In FX markets, the greenback was softer across the board. AUD/USD was the biggest mover climbing 0.55%. In the crypto space, BTCUSD is 0.17% lower trading at $41,430.
News from overnight: 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.
