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The gold price is in consolidation mode ahead of the next big move
It has been a pretty lackluster start to the week as gold is trading pretty much flat at $1925/oz. The chart pattern however throws up lots of questions about the next possible move for the yellow metal. The pattern remains sightly bearish but the trend is still up. On the downside the two key support areas are marked by the orange ($1919.4/oz) and green ($1881.4/oz) lines There is also a high volume node from the volume profile indicator at $1889.8/oz that could be sticky.
On the upside, the red trendline and red shaded resistance are the two key sticking points. The area at $1976/oz could make a head and shoulds (bearish) pattern if the price rejects there but it remains to be seen if the bulls can drag the price up there at the moment. Lastly, the volume is looking very thin as the price moves down. This could mean that market participation on the downside is weak. If the support levels break keep an eye on the volume as they could be "fake outs" to the downside before the bulls step in at lower levels. Read More
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Food prices are about to skyrocket even more; Prepare for a 'famine,' followed by housing crash, then equities wipeout - Michael Gayed
Food prices are about to go up by a considerable degree, to the point where a "famine" is going to hit parts of the world, according to Michael Gayed, portfolio manager of Toroso Investments. Read More
Gold rallies as bulls buy the early dip
Gold prices are higher in midday U.S. trading Monday, boosted by bargain hunting in the cash market and short covering in the futures market. Sharply higher oil prices again today also helped to lift the metals markets. April gold futures were last up $7.90 at $1,937.10 and May Comex silver was last up $0.383 at $25.47 an ounce.
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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 $1,951.00 and then at $1,956.90. First support is seen at today’s low of $1,917.20 and then at $1,908.10. Wyckoff's Market Rating: 6.5. Read More
Fed open to speedier interest rates hikes if high inflation persists - Powell
March 21 (Reuters) - Federal Reserve policymakers will consider speeding up the pace of interest rate hikes this year should high inflation not begin to abate, Federal Reserve Chair Jerome Powell said on Monday.
"The expectation going into this year was that we would see inflation peaking in the first quarter, then maybe leveling out and see a lot of progress in the second half. That story has already fallen apart," Powell said in comments to a National Association for Business Economics conference in Washington. "To the extent it continues to fall apart my colleagues and I may well reach the conclusion we'll need to move more quickly and if so we'll do so." Read More
Gold price off its highs as Powell says inflation is too high
Gold prices have fallen from their session highs but are still holding on to gains even as Federal Reserve Chair Jerome Powell signed that the central bank could aggressively tighten interest rates more than markets are expecting.
"We will take the necessary steps to ensure a return to price stability. In particular, if we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so. And if we determine that we need to tighten beyond common measures of neutral and into a more restrictive stance, we will do that as well," Powell said in his keynote address at the National Association for Business Economics Annual Economic Policy Conference.
The gold market appears to be taking the hawkish comments in stride. April gold futures last traded at $1,935 an ounce, up 0.30% on the day.
Powell's hawkish stance on the monetary policy comes as inflation pressures grow. He added that the inflation outlook has deteriorated significantly as it has been persistently higher than forecasters have expected.
"Inflation is much too high. We have the necessary tools, and we will use them to restore price stability," Powell said in his concluding remarks. Read More
Gold still shines as a safe haven even as hedge funds reduce bullish bets
Analysts aren't giving up on gold, saying that the precious metal's safe-haven allure hasn't completely diminished; however, some hedge funds have reduced their bullish exposure to gold as investors prepared for the Federal Reserve's new tightening cycle, according to the latest data from the Commodity Futures Trading Commission.
The CFTC disaggregated Commitments of Traders report for the week ending March 15 showed money managers lower their speculative gross long positions in Comex gold futures by 15,913 contracts to 165,597. At the same time, short positions rose by only 523 contracts to 39,060.
Gold's net length now stands at 126,537 contracts, down roughly 11.5% from the previous week. However, bullish positioning is up more than 150% after hitting a nearly one-year low in early February.
During the survey period, gold prices saw a sharp decline but held critical support around $1,900 an ounce.
Daniel Briesemann said that bullish speculative interest in gold is also reflected in gold-backed exchange-traded products. He noted that the market has seen nine consecutive weeks of inflows. Read More
Concerns about the Ukraine war and global inflation increase bullish sentiment for gold
After declining over $60 per ounce last week gold found solid footing and support at approximately $1920. As of 4:30 PM EDT gold futures basis, the April 2022 contract is up by $6.50 and fixed at $1935.90. April gold has become spot pricing with a first-day delivery notice on Friday of this week. The most active contract month in gold switches every two-month increments, so the next front month for gold will be the June 2022 contract. Currently, the spread between April and June gold futures is approximately five dollars, with the June futures contract currently trading up $6.90 and fixed at $1940.80. Read More
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New global 'commodity-based' monetary order is coming – Credit Suisse
A new monetary order is looking more and more likely as a commodities crisis feeds into inflation, according to Credit Suisse, which sees the U.S. dollar as losing the battle.
"This crisis is not like anything we have seen since President Nixon took the U.S. dollar off gold in 1971 – the end of the era of commodity-based money," said former Federal Reserve and U.S. Treasury Department official and now Credit Suisse investment strategist Zoltan Pozsar. "When this crisis (and war) is over, the U.S. dollar should be much weaker and, on the flip side, the renminbi much stronger, backed by a basket of commodities."
After the war in Ukraine, money will not be the same, said Pozsar describing the history of the Bretton Woods monetary order. The investment strategist is betting on commodities, including gold.
"From the Bretton Woods era backed by gold bullion, to Bretton Woods II backed by inside money (Treasuries with un-hedgeable confiscation risks), to Bretton Woods III backed by outside money (gold bullion and other commodities)," he stated. Read More
Silver is trading higher heading into the European open
Gold (-0.12%) is trading marginally lower heading into the European open. Elsewhere silver is 0.35% higher trading at $25.27/oz. In the rest of the commodities complex, copper has fallen 0.22% and spot WTI is 0.95% in the red.
Risk sentiment was fairly good overnight. The Nikkei 225 (1.48%), ASX (0.86%) and Shanghai Composite (0.19%) all closed higher. Futures in Europe are pointing to a slightly negative cash open.
In FX markets, USD/JPY was the biggest mover overnight rising 0.84%. The greenback also performed well against the EUR and GBP. In the crypto space, BTC/USD rose nearly 3% and is trading at $42,238. 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.
