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Is this the bottom?
As suggested yesterday, metals are bouncing out of oversold conditions this morning. Overhead resistance will be in the $1,960-$1,965 range for gold. Silver has held up better than gold during the recent selloff and is also seeing a bounce this morning. Resistance is now likely in the $25.90 area. Platinum bulls have the metal trading at $1,020 as of this writing and are looking to get the price back over $1,035. Palladium bulls may finally be in for some short-term relief with the metal looking to carve out what seems like a temporary bottom. Read More
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Gold prices holding overnight gains following a strong rise in Philly Fed Survey
The gold market continues to hold on to solid overnight gains as momentum in the Philadelphia region continues to build positive momentum, according to the latest data from the Philadelphia Federal Reserve.
Thursday, the regional central bank said its manufacturing business outlook rose to a reading of 27.4 in March, up from its February reading of 16. The data significantly beat expectations as consensus forecasts were calling for a reading around 15.1.
The report said that the index is at its highest level since November 2021.
The better-than-expected data is not having much impact on gold prices as the market holds strong gains following a hawkish statement from the Federal Reserve Wednesday, following its monetary policy meeting. April gold futures last traded at $1,940.5 an ounce, up 1.65% on the day. Read More
Gold, silver post strong rebounds on short-covering, bargain buying
Gold and silver prices are sharply up in midday U.S. trading Thursday, helped by bullish outside markets that include big gains in crude oil and a sharply lower U.S. dollar index on this day. Safe-haven demand and perceived bargain hunting are also featured in the precious metals late this week. April gold futures were last up $33.90 at $1,943.10 and May Comex silver was last up $0.88 at $25.59 an ounce.
Image Source: Kitco News
Technically, April gold futures bulls have the overall near-term technical advantage. Recent price action still suggests a market top is in place. 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 $1,850.00. First resistance is seen at today's high of $1,951.00 and then at $1,956.90. First support is seen at today's low of $1,924.00 and then at $1,908.10. Wyckoff's Market Rating: 6.5. Read More
Gold price has a path to $2,200 after Fed revealed its strategy - SSGA's Milling-Stanley
The Federal Reserve has laid out a clear tightening path, and now gold prices are free to push to new highs above $2,000 an ounce as inflation will remain a clear threat to consumers, according to one market strategist.
In a telephone interview with Kitco News, George Milling-Stanley, chief gold strategist at State Street Global Advisors, said Wednesday's monetary policy decision was slightly more hawkish than he expected; however, he added that it was a lot more dovish than market outlook.
As expected, the Federal Reserve raised interest rates by 25 basis points. At the same time, it signaled that it could start reducing its balance sheet at the next meeting. The central bank also updated its economic projections, lowered its growth forecast, and raised its inflation expectations for 2022. Finally, the central bank also sees the potential for seven rate hikes this year.
While this might sound hawkish, Milling-Stanley said it wouldn't be enough to frighten the gold market.
"If indeed the Federal Reserve does follow through with its plan that will put interest rates at 1.75% by the end of the year," he said. "Interest rates will remain under 2% this year. I don't think markets have much to worry about."
Milling-Stanley said that the gold market is reacting as he expected it. With the Fed's blueprint laid out, investors can now focus on the growing inflation threat, he added. Read More
$3k gold, $50 silver price is next; Double-digit inflation next month 'wouldn't surprise me' - Briton Hill
As inflation continues to spiral up to the highest level in 40 years, investors are looking for hedges against rising consumer prices.
"Commodities are my go-to. Stocks are a good hedge for moderate inflation, but we are past that. I like gold because it is stable," emphasized Briton Hill, President of Weber Global Management. "Gold is easy to get in and out of, and you can buy it anywhere. Silver is also a good investment."
Hill discussed investment hedges in this inflationary environment with David Lin, Anchor at Kitco News. Read More
Gold has proven its value as a diversified asset - Invesco's Hooper
Volatility and uncertainty continue to sweep through financial assets. Now is the time investors should be well-diversified, which includes having exposure to commodities, including gold, according to one market strategist.
In a recent telephone interview with Kitco News, Kristina Hooper, chief investment strategist at Invesco, said tactically being overweight gold to other commodities could help weather the current storm caused by Russia's war with Ukraine, which has entered its fourth week.
Hooper said that with volatility now commonplace in markets, gold is attractive around $1,950 an ounce, and prices are expected to remain elevated through 2022. However, she added more than the short-term trend; the current environment has proved gold's value as a long-term diversified asset.
"This is the year everyone will believe in the Gospel of diversification," Hooper said. "The argument for gold as an asset class is strong. There could be a number of years when you don't think you need an asset like gold in your portfolio until the time comes when you realize you do."
Hooper added that even if Russia's war with Ukraine is resolved, the world has become a lot more uncertain. Read More
Commodity chaos triggers double-digit gains for gold price as war in Ukraine enters fourth week
Precious metals are back at the top of the leader board, posting double-digit gains as the volatile commodity space keeps investors looking at gold, palladium, silver, and platinum.
On Thursday, the commodity space surged as oil prices rose on fears of possible supply shortages due to the Russia-Ukraine conflict.
"Volatility has been the defining feature across all asset classes in recent weeks, catalyzed by the Russian invasion of Ukraine," said DailyFX senior strategist Chris Vecchio. "The global supply chain is in disarray; commodity prices have surged, threatening both companies' margins and consumers' spending power; and central banks are pressing ahead with reducing stimulus and tightening monetary policy."
The big news still being digested by markets is the Federal Reserve's 25 basis point hike with projections of another six hikes for this year. On top of this hawkish stance, Fed Chair Jerome Powell told reporters that the U.S. economy "can handle" tighter monetary policy and that recession risk is not elevated.
"Gold prices are firming despite the undeniably hawkish FOMC, lending a lifeline to trend followers should prices close above $1,920/oz," said strategists at TD Securities. "The price action also suggests that a contingent sees the Fed's hiking profile as too slow given the inflation pressures facing the economy … While a coordinated buying impulse from a broad group of gold traders had helped gold prices rise dramatically in past weeks, we could still see a coordinated reversal inflows." Read More
Fed rate hike does little to change investors’ focus on inflation and Ukraine
Yesterday the Federal Reserve initiated their first interest rate hike since 2018, taking the Fed Funds rate from 0 - ¼% to ¼% - ½%. The rate hike of ¼% was not only anticipated by market participants but was also factored into current pricing. The dramatic change in the Fed’s forward guidance announcing that they intended to raise rates at each of the FOMC six meetings this year was not expected. Even more interesting was how investors reacted to the aggressive Fed policy.
Image Source: Kitco News
Gold gained approximately 2.47 % from yesterday’s low of $1895 compared to its current value of $1943. The NASDAQ composite gained 2.93%, the S&P 500 gained 2.78%, and the Dow Jones Industrial Average gained 2.42% in the last two days. This is a clear indication that the majority of traders and investors are focusing on the economic climate that exists now rather than what might occur at the end of this year or next.
On a technical basis, yesterday’s low of $1895 in gold futures was a 61.8% retracement from the highs which occurred last week. This is a deep but acceptable level for a correction to conclude at. That is why in yesterday’s article, we stated that the daily low in gold was probably the conclusion of the recent selloff that could easily result in a pivot or key reversal, taking gold prices substantially higher. While we are anticipating a dramatically higher rising in gold over this year, the question is, will gold encounter resistance? Read More
Inflation will stay at 6% to 9% until 2024, Fed’s rate hikes won’t stop that now – Steve Hanke
The U.S. Federal Reserve hiked the Fed Funds rate by 25 basis points on Wednesday, the first-rate hike since 2018.
While this move was largely anticipated, the markets still rallied on the news; both the stock markets and safe-haven assets like gold rose. The dollar fell slightly.
Steve Hanke, professor of Applied Economics at Johns Hopkins University told David Lin, anchor for Kitco News, that the stock markets interpreted this news as quite dovish. Read More
Gold is marginally lower heading into the European open
Gold (-0.44%) and silver (-0.32%) are both heading into the European open lower on Friday. In the rest of the commodities complex, copper is 0.15% higher and spot WTI is nearly 2% in the black.
In the risk markets, the Nikkei 225 (0.65%), ASX (0.60%), and Shanghai Composite (1.12%) all closed higher. Futures heading into Europe are also indicating a positive cash open.
In FX, the biggest mover overnight was USD/JPY which rose 0.32% and the dollar index is marginally higher. In the crypto space, BTC/USD is 0.34% lower. 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.
