Zaner Daily Precious Metals Commentary

Friday, July 5, 2024 11:14:40 AM America/Chicago

7/5/2024

Gold and silver surge to 4-week highs on Fed rate cut expectations
 
OUTSIDE MARKET DEVELOPMENTS
: The Labour Party scored a historic victory in UK elections, ending a 14-year Tory Party reign. Incoming Prime Minister Keir Starmer says "change begins now."

He is likely referring to the homefront, where he plans to tackle the cost-of-living crisis, illegal immigration, crime, and long NHS wait times. Foreign policy is expected to remain largely unchanged, including continued robust military support for Ukraine.

Labour views Russia as a threat to Europe and their manifesto favors NATO membership for Ukraine. NATO on its border is a red line for Russia and that threat arguably played a significant role in Putin's decision to invade.

The latest polling in France suggests Marine Le Pen's National Rally party which made strong gains in the first round of voting may still fall short of a majority in the National Assembly. There has been increased violence in France during the election process including attacks on candidates. Prime Minister Gabriel Attal called on the French people to "reject the climate of violence and hatred that's taking hold."

Iranians voted between hardliner Saeed Jalili and reformist Masoud Pezeshkian in a runoff presidential election. Regardless of the winner, Supreme Leader Ayatollah Ali Khamenei will still have the final say on just about everything of consequence.

Widespread apathy and calls for a boycott to protest the regime led to low voter turnout in the first round. A Jalili win would likely bend policy toward closer ties with Russia and China and a push forward in nuclear weapons development. It's doubtful that Pezeshkian has the wherewithal to develop a more moderate tone toward the West.

The Nikkei 225 continued to set record highs on Thursday, led by heavy buying in tech and automaker shares. The breakout above the previous record high set in 1989 initially occurred in March and gains have been mounting since, driven largely by the AI frenzy that is also lifting U.S. equities.

U.S. nonfarm payrolls rose 206k in June, above expectations of +200k, versus a negative revised +218k in May (was +272k). While the headline number was good, private payrolls were just +136k, below expectations of +175k, versus a negative revised +193k (was +229k).

The unemployment rate ticked up to 4.1% on back-month revisions, weak civilian employment, and an uptick in the labor force participation rate to 62.6%. Hourly earnings were up 0.3% in line with expectations. The average workweek was steady at 34.3 hours.

Hints of weakness in the jobs report give further confidence to the sooner-than-later-rate-cut camp. The prospects for a September rate cut have jumped to 71.8% based on Fed funds futures. Additionally, the FOMC minutes released on Wednesday revealed that policymakers saw "modest further progress toward the 2% inflation goal," a gradually cooling economy, and policy as restrictive.

Nonetheless, the FOMC is still displaying enough uncertainty as to the appropriateness of current policy and the tack of incoming data to cast doubt on a September rate cut. Proximity to the November election may be a Fed consideration as well.

Fed Chairman Powell's monetary policy testimony before the House and Senate next week may provide additional clues to the Fed's intentions. I expect him to maintain his cautious tone and maybe even come off a little hawkish to temper the recent market reactions.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$7.86(+0.33%)

5-Day Change: +$38.05 (+1.64%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34
Weighted Alpha: +24.65

Gold has surged to 4-week highs on mounting expectations that the Fed will cut rates twice this year, despite persistent words of caution from Fed policymakers. The yellow metal is poised for a second consecutive higher weekly close.



An upside breakout of the symmetrical triangle pattern that formed since the record high was set on 20-May at $2,449.34 bodes well for a continuation of the dominant uptrend. However, sustained gains above $2400 may be difficult initially due to the current overbought condition.

Former resistances at $2,367.22 and  $2,364.17/$2,361.88 now define initial support levels.

Ole Hansen, Head of Commodity Strategy at Saxo Bank remains bullish on gold based on persistent geopolitical risks, strong retail demand in China, ongoing central bank demand, rising debt-to-GDP ratios among major economies (most notably the U.S.), and higher rate cut expectations. Hanson's year-end gold forecast is $2500.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.212 (+0.70%)
5-Day Change: +$1.455 (+4.99%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379
Weighted Alpha: +38.93

Silver is adding to gains having broken out above channel resistance earlier in the week. Heightened expectations of a September rate cut are helping the cause. 



The white metal is up more than 6% this week and is currently trading at 4-week highs. The 61.8% retracement level of the corrective decline from $32.379 has been negated at $30.942 lending considerable credence to the notion that the corrective low is in place at $28.618.

The next level to watch on the upside is $31.516 (07-Jun high) which corresponds closely with the 78.6% retracement level at $31.574. A push through this level may prove difficult initially given the developing overbought condition, but short-term setbacks are likely to be viewed as buying opportunities.

Former resistances at $30.78/82 and $30.622/56 now mark the first two tiers of support.

Saxo Bank's Hansen is sticking with his year-end target of $35.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, July 3, 2024 10:07:18 AM America/Chicago

7/3/2024

Gold and silver jump on rising Fed rate cut expectations

OUTSIDE MARKET DEVELOPMENTS
: Markets seem to be reading yesterday's comments by Fed Chairman Powell at the Central Banking Forum in Portugal as dovish. U.S. yields and the dollar have weakened, providing a lift for the precious metals.

In my view, Powell didn't say anything new or exciting. The market however has latched on to his statement that "we are getting back on the disinflationary path.” That's just another way of saying we've made progress on inflation, but Powell added that more data are needed before the Fed can start easing policy.

Nonetheless, the prospects for a September rate cut have edged higher. Fed funds futures put the probability at 62% this morning. Attention now turns to this afternoon's release of the minutes from the June FOMC meeting to see if any additional clues are revealed.

ECBSpeak out of Portugal suggests the European Central Bank is on hold for July due to "sticky inflation." However, mounting growth risks likely warrant additional rate cuts later in H2.

The U.S. ADP Employment Survey saw private payrolls increase by 150k in June, below expectations of +165k, versus an upward revised +157k in May.

Initial jobless claims were 238k in the week ended 29-Jun, above expectations of 235k, versus an upward revised 234k in the previous week.

Challenger layoffs declined to 48.8k in June, versus 63.8k in May. That's the lowest print since December.

The U.S. trade deficit widened to -$75.1 bln in May, inside expectations of -$76.4 bln, versus a revised -$74.5 bln in April. Both imports and exports dropped. The deficit remains well off the historic wide of -$101.9 bln from March 2022.

Factory orders fell 0.5% in May, below expectations of +0.3%, versus a negative revised +0.4% in April (was +0.7%).

Services PMI rose modestly to 55.3 in June from 55.1 in May. However, services ISM tumbled to 48.8 in June, well below expectations of 52.5, versus 53.8 in May.

Today's generally weak U.S. economic data – and neutral jobs data – may give the Fed room to make their first rate cut sooner than later.  


GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$16.63 (+0.71%)

5-Day Change: +47.66 (+2.07%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34
Weighted Alpha: +23.29

Gold jumped in overseas trading helped by an easier dollar. Gains extended in early U.S. trading and the yellow metal has reached a 2-week high of $2,354.41.


With resistances at $2,337.90/$2,338.03 and $2,339.36 negated, the 21-Jun high at $2,367.22 is the next attraction. While short-term price action has been rather choppy, June's range is intact and June's range was within May's.

Taking all that into consideration, trading since the all-time high was set at $2,449.34 on 20-May sure looks like a continuation pattern within the dominant uptrend. A breach of the June high at $2,386.90 would offer additional encouragement to the bull camp. However, such a move may prove difficult ahead of tomorrow's holiday session given the developing overbought condition.

The World Gold Council's mid-year outlook notes that gold has benefitted this year from "continued central bank buying, Asian investment flows, resilient consumer demand, and a steady drumbeat of geopolitical uncertainty."

The WGC sees gold garnering support in H2 from falling yields along with, "investors looking to hedge bubbling risks amid a complacent equity market and persistent geopolitical tensions."


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.648 (+2.19%)
5-Day Change: +1.471 (+5.11%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379
Weighted Alpha: +36.72

Silver surged back above $30 overseas and added to those gains in early U.S. trading. The white metal is up over 3% on the day, buoyed by growing confidence that the Fed will cut rates twice this year.



Today's gains constitute an upside breakout of the bear channel that developed over the 6 weeks since silver established an 11-year high at $32.379 on 21-May. As noted in yesterday's commentary, I like it when silver leads on rallies. I really like it when there's buy-in from the gold market.

The $30.824 high from 21-Jun is the next resistance level I'm watching. Given the intraday overbought condition that has developed and tomorrow's holiday, look for the upside to be somewhat limited ahead of Friday's jobs data. However, the underlying uptrend has regained some credence with today's gains.

Today's FOMC minutes remain a potential wild card.

Maria Smirnova, chief investment officer for Sprott Asset Management said, "We expect silver prices to continue to improve, driven by low interest rates, more robust physical, ETF purchases and increased industrial demand.”


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, July 2, 2024 10:47:59 AM America/Chicago

7/2/2024

Gold choppy within recent ranges while silver sets 7-session highs
 
OUTSIDE MARKET DEVELOPMENTS
: Markets are reacting to comments coming out of the Central Banking Forum in Sintra, Portugal. Fed Chairman Jerome Powell acknowledged that the Fed has made considerable progress, but wants to be sure inflation is indeed headed toward the 2% goal before starting to cut rates. 

Powell sees risks as being more two-sided now but was disinclined to provide any hints on a timeline. "I am not going to land on any specific date," said Powell.

Chicago Fed President Austan Goolsbee warned that holding rates where they are as inflation comes down is tantamount to tightening. "You should do that by decision, not by default," said Goolsbee. The implication is that rates should be coming down with inflation so policy doesn't become too restrictive and amplify growth risks.

While Powell's comments didn't break any new ground, the markets seemed to like what Goolsbee had to say. Yields and the dollar eased in reaction providing an intraday lift for the metals. That lift was temporary for gold, but silver is holding onto gains.

Eurozone CPI ticked down to 2.5% y/y in June, versus 2.6% in May. ECB Governing Council member Vasle suggested rates could be cut further but wants to see more data to confirm the downward trajectory of inflation.

ECB President Lagarde apparently concurs. "It will take time for us to gather sufficient data to be certain that the risks of above-target inflation have passed," she said.

U.S. JOLTS job openings rose to  8,140k in May, versus a downward revised 7,919k in Apr.

RCM/TIPP Economic Optimism Index rose to 44.2 in Jul, up from 40.5 in Jun.

Domestic auto and light truck sales for Jun come out later today. The market is expecting 2.1M and 10.2M respectively.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$7.50 (-0.32%)

5-Day Change: +$8.91 (+0.38%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34
Weighted Alpha: +22.02

Gold is trading in a choppy manner today, but price action remains confined to yesterday's range thus far. It is in fact the second consecutive inside day. 



Comments out of the Central Banking Forum in Portugal are driving the trade. The central bankers seem to like the trajectory of inflation but are reluctant to declare victory over price risks. More data are needed.

Short-term resistance is clearly defined by the highs from the previous two sessions at $2,337.90/$2,338.03. This level is bolstered by a Fibonacci level at $2,339.36. Penetration of the latter would shift focus to the 21-Jun high at $2,367.22.

Support is marked by the lows for the previous two sessions at $2,319.98/85. Below that, the 26-Jun low at 2,295.86 protects the more important cycle low at $2,287.64 from 07-Jun.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$0.110 (-0.37%)
5-Day Change: +$0.481 (+1.66%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379
Weighted Alpha: +31.50

Silver is trading higher for a fourth consecutive session. The white metal has set a 7-session high of $29.748. Generally speaking, I like it when silver leads on rallies.




Despite all the words of caution coming out of Portugal, Fed funds futures continue to price in two rate cuts this year. If the Fed can orchestrate a soft landing, the fundamental picture for silver remains broadly supportive.

More than 50% of the leg-down from $30.824 (21-Jun high) to $28.618 (26-Jun low) has now been retraced. The upper limits of the bearish channel have also been challenged. Additional upside follow-through would bode well for a test of the 61.8% retracement level at $29.981.

Trades with a 30-handle would go a long way toward convincing me the corrective low is now in place. I'd like to see some better performance on the upside out of gold as well. 


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, July 1, 2024 11:11:10 AM America/Chicago

7/1/2024

Gold and silver consolidate within Friday's ranges with focus still on Fed intentions

OUTSIDE MARKET DEVELOPMENTS
: The year's second half begins with heightened political uncertainties. The top of the ticket for the Democratic Party is suddenly in doubt for the U.S. election in November after incumbent Joe Biden's dismal debate performance on Thursday.

Post-debate polling is perpetuating the angst among Democrats, having swung in favor of former President Donald Trump. A CBS News/YouGov poll showed that 72% of registered voters surveyed do not believe Biden has the “mental and cognitive health necessary to serve as president.” Nonetheless, at this point, Biden remains the presumptive nominee.

It appears that French President Macron's gamble to call snap elections following the swing to the right in European Parliamentary elections in June has failed. In the first round, Marine Le Pen's National Rally party received over 33% of the vote, while the far-left Popular Front got 28%. Macron's centrist alliance came in third at 20.8%.

The PBoC has announced they will intervene in the bond market "in the near future." The goal is undoubtedly to halt the rally in bonds that has driven China's 10-year yield to 2.18%, its lowest level since 2002.

U.S. bases in Europe went on heightened alert over the weekend amid possible terrorist threats. Force Protection Condition “Charlie” is the second highest alert status and reportedly hasn't been seen "in at least 10 years" according to a U.S. official cited by CNN.

U.S. manufacturing PPI rose to 51.6 in Jun, versus 51.3 in May and 51.7 flash. Manufacturing ISM fell to 48.5 in Jun on expectations of 49.1, versus 48.7 in May. ISM prices fell to 52.1 from 57.0 in May.

Construction spending fell 0.1% in May, below expectations of +0.3%, versus a revised +0.3% in Apr (was -0.1%).

Taken in conjunction with last week's soft inflation data, this morning's economic reports perhaps give a slight boost to sooner-than-later Fed rate cut expectations. Fed funds futures put the prospect of a Sep rate cut at 58.2% this morning.


GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$5.51 (+0.24%)

5-Day Change: +$2.09 (+0.09%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34
Weighted Alpha: +22.58

Gold starts H1 in neutral territory despite heightened political uncertainty and worries about a potential terrorist attack in Europe. Price action has been contained by Friday's range thus far.



Gold achieved a higher close last week, but ended the month of June with a slight loss (-$1.31). It was the first lower monthly close in five. The yellow metal posted a 4.2% Q2 gain and was up 12.8% for H1.

The corrective low from 07-Jun at $2,287.64 has held for over three weeks now, adding some degree of confidence to the notion that the low is in. A breach of short-term chart/Fibonacci resistance at $2,338.03/$2,339.36 would offer further encouragement to the bull camp and favor a retest of the 21-Jun high at $2,367.22.

On the other hand, a retreat below Friday's low at $2,319.85 would call for more consolidation in the lower half of last week's range with some heightened risk to key support at $2,287.64.

The COT report showed that net speculative long positions rose to 246.2k contracts last week, versus 243.2k in the previous week. That's the highest since Apr 2022 and suggests the $2,300 zone continues to draw bids. 


Central banks reported 10 tonnes of net gold buying in May, despite record-high prices at the time. Top buyers were Poland (10 tonnes), Turkey (6 tonnes), India (4 tonnes), and the Czech Republic (3 tonnes). Kazikstan was the biggest seller at -11 tonnes.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.098 (+0.34%)
5-Day Change: -$0.271 (-0.92%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379
Weighted Alpha: +30.95

Silver is trading higher for a third session but price action is well contained within last week's range. The white metal notched a second consecutive lower weekly close on Friday and ended June with a decline of 4.2%. It was the first lower monthly close in four.

 

Silver rose 16.8% in Q2 and posted a 22.5% gain for H1. Despite the June losses, the dominant trend is still bullish.

Last week's range of $28.618 to $29.714 defines short-term support and resistance.

The COT report showed that net speculative long positions rose to 56.0k contracts last week, versus 51.9k in the previous week. That's the highest since the first week of June.

Heraeus notes that increased solar power manufacturing in the U.S. and the expansion of EV charging infrastructure bodes well for domestic silver demand. The U.S. is also expected to announce new tariffs aimed at  Chinese solar panels. 


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, June 28, 2024 11:33:55 AM America/Chicago

6/28/2024

Gold hovers near unchanged for the month but appears poised for weekly, quarterly, and H1 gains
 
OUTSIDE MARKET DEVELOPMENTS
: The U.S. Democratic Party is in panic mode following President Biden's debate performance last night. The President appeared feeble and was at times incoherent.

Very senior party officials and pols are reportedly having serious conversations about replacing Biden at the top of the ticket with just 130 days until election day. I suspect many Americans are wondering this morning if the true reigns of power are already not in Mr. Biden's hands. If they're not, who's running the country? If they are, should they be?

U.S. personal income rose 0.5% in May on expectations of +0.4%, versus +0.3% in Apr.

PCE climbed 0.2%, just below expectations of +0.3%, versus a negative revised +0.1% in Apr.

The PCE chain price index was unchanged, in line with expectations. The core PCE chain price index also matched expectations at +0.1%.

I see these data as broadly neutral, perhaps modestly heartening those calling for two rate cuts this year. Prospects for a Sep rate cut continue to hover around 60% despite recent hawkish FedSpeak that seems to be trying to dispel the two-cut notion.

The IMF has warned that U.S. high deficits and debt "create a growing risk to the U.S. and global economy." They called on the U.S. to raise taxes to address the issue. The IMF also revised down its U.S. growth outlook from 2.7% to 2.6%.

The latest ECB Consumer Expectations Survey suggests Eurozone inflation will continue to ease. This and the uptick in German unemployment to 6% should help keep the ECB on its recently initiated easing path.

Japan sacked Masato Kanda, Vice Minister of Finance for International Affairs within the Ministry of Finance, replacing him with Atsushi Mimura. Kanda had led unsuccessful efforts to support the yen through jawboning and direct intervention.

The yen has fallen to 38-year lows. Efforts to support the yen are expected to persist, but Japan's massive debt and demographic challenges are a millstone around the neck of monetary policy. Mimura faces those same challenges.

The dollar remains generally well bid with the yen on the ropes and scope seen for further ECB rate cuts. The dollar index retested the 8-week high set on Wednesday at 106.13. While this level remains intact thus far, a challenge of the high for the year at 106.52 seems likely. Beyond that, last year's high of 107.35 attracts. 

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$8.24 (+0.35%)

5-Day Change: +13.39 (+0.58%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34
Weighted Alpha: +23.04

Gold extended to a new high for the week of $2,338.03 following a generally uneventful PCE report for May. Most importantly, the Fed's favored measure of inflation suggested price risks are in check which may give the central bank room for at least one, and possibly two rate cuts this year.



The yellow metal appears poised for a higher weekly close. A close above $2,327.82 would confirm a fifth consecutive higher monthly close. With gold presently trading around $2,331.00 the monthly close is too close to call. Current pricing puts gold up 4.4% in Q2 and +13% in H1.

Tests of the downside this week have reinforced support marked by the 07-Jun low at $2,287.64. Bull camp confidence that the corrective low is in place has been bolstered. The 61.8% retracement level of the decline from last week's high has been pressured at $2,339.36. A breach of this level would bode well for a test of $2,367.22 (21-Jun high).

A new intraday low below $2,319.85 would deflate bullish optimism setting up potential for further probes below $2300.

I wrote yesterday about the "Costco effect" pulling average U.S. investors into the gold market and the warmer feelings toward gold among professional investors. An AP article this week reports that Poles have turned to gold amid high inflation and ongoing concerns about geopolitical instability in the region that has led to a migration crisis.

"In Poland, gold’s allure is intertwined with the enduring trauma of World War II, when it could ensure survival." This theme has been repeated around the world and throughout history. A client at a company I previously worked for told a harrowing tale of escaping Vietnam with his family after the fall thanks to their horde of gold tael bars.

A survey from SSGA and WGC showed that 76% of investors in the Asia/Pacific region have some allocation to gold. Nearly half have allocations of 1% to 4.9%. That 24% have no allocation to gold means there is significant room for demand to grow.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.396 (-1.37%)
5-Day Change: -$0.180 (-0.61%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379
Weighted Alpha: +32.99

Silver set a 5-session high of $29.587 following the PCE report, but the high for the week at $29.714 was not seriously challenged. The white metal fell to a 5-week low midweek and appears poised for a lower weekly close and the first lower monthly close in four.

 

Based on a current price of $29.30, silver is up about 17% for Q2 and +23% for H1. The longer-term trend remains bullish, but I'd need to see further evidence to convince me the corrective low is in place.

UBS believes U.S. rates and the dollar need to start coming down in H2 to open the upside for silver and draw investors back into ETFs. Today's data seem to favor at least one Fed rate cut this year, but even once Fed easing is underway I think interest rate differentials will underpin the dollar for some time.

UBS believes industrial demand, particularly from the photovoltaic sector, will remain strong. They also see mine output contracting marginally this year. Strong demand and reduced supply bode well for the price of silver in H2, even if the dollar remains supported.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, June 27, 2024 11:03:21 AM America/Chicago

6/27/2024

Gold and silver rebound from Wednesday's losses with focus on presidential debate and inflation data

OUTSIDE MARKET DEVELOPMENTS
: The dollar has eased from yesterday's 8-week high, providing some relief for the precious metals. The pullback is seen as corrective in nature with interest rate differentials expected to remain broadly supportive to the greenback.

Sweden's Riksbank held steady on rates as expected, but the messaging was quite dovish with inflation seemingly in check and the economy slowing. "If inflation prospects remain the same, the policy rate can be cut two or three times during the second half," said Riksbank Governor Erik Thedeen.

U.S. market focus remains squarely on tonight's presidential debate and Friday's personal income and PCE data for May. Particular attention will be paid to the PCE chain price index as it is the Fed's preferred measure of inflation. Median expectations are unchanged, and an uptick of 0.1% in the core reading.

U.S. durable goods new orders rose 0.1% in May on expectations of +0.2%, versus a negative revised +0.2% in Apr (was +0.7%). Ex-transportation fell 0.1% and shipments came in at -0.3%.

Initial jobless claims fell 6k to 233k in the week ended 22-Jun, versus an upward revised 239k in the previous week.

U.S. advance goods trade deficit expanded to -$100.6 bln in May, outside expectations of -$96.0 bln, versus -$97.9 bln in Apr.

U.S. Q1 GDP was revised up to 1.4% in the third report in line with expectations, versus 1.3% previously. The GDP chain price index was revised to 3.1% from 3.0%. Core was revised up to 3.7% from 3.6%.


GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$17.11 (+0.74%)

5-Day Change: -$41.80 (-1.77%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34
Weighted Alpha: +21.84

Gold has retraced all of yesterday's losses and then some, buoyed by a setback in the dollar. Important short-term support at $2,287.64 was left untested yesterday as the trade awaits tomorrow's inflation data.



A downtick in inflation would likely be a positive for gold as it would heighten expectations for a sooner-than-later Fed rate cut. On the other hand, a hot inflation print would keep the Fed on hold and continue to pose a headwind for the yellow metal.

China's net imports of gold through Hong Kong fell 22.7% to 26.722 tonnes in May, versus 34.575 tonnes in Apr. This may be attributable to record high prices in May.

The CEO of MKS PAMP, the fabricators of the Fortuna gold bar being sold at Costco, says he has "not seen such dynamic physical markets." Certainly, Costco's entrance into the bar and coin market last year is having an outsized impact on the space.

Wells Fargo estimates that Costco is selling $200M worth of gold per month. That's more than 80,000 ounces every month, and that's being throttled by availability. Costco inventory typically sells out "within a few hours."

The following is a fascinating graphic from the latest Costco article, showing the decline in Americans' confidence in political and social institutions. The implication is that this broad-based loss of confidence is driving average investors to seek shelter in "the old-school store of value."



A recently commissioned World Gold Council survey shows that gold ownership is also on the rise among professional investors. "A staggering 85% reported an allocation to some type of gold investment, up from 69% in 2018," said the WGC. The survey suggests gold allocations will be steady to higher over the next 12-18 months.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.126 (+0.44%)
5-Day Change: -$1.638 (-5.33%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379
Weighted Alpha: +31.30

Silver has bounced from the 6-week low set yesterday at $28.618. However, the new cycle lows set this week leave the downside vulnerable heading into the end of Q2 and H1.



It would take a rebound above $29.714/$29.721 to set a more favorable short-term tone. This level is defined by the high for the week from Monday and the halfway back point of the decline from last week's high at $30.824.

Such a move seems unlikely in advance of Friday's inflation data and the intraday overbought condition that has developed. Below-expectations inflation tomorrow could open the upside to more serious tests. Alternatively, hot inflation would keep focus on the downside.

Action tomorrow should be telling. Will corrective forces continue to dominate, or will the long-term up-trend reexert itself early in Q3?


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, June 26, 2024 10:34:07 AM America/Chicago

6/26/2024

Gold and silver continue to slide on strong dollar, hawkish Fed, and inflation concerns

OUTSIDE MARKET DEVELOPMENTS
: The dollar remains generally well bid, buoyed by interest rate differentials. The dollar index has reached 8-week highs and appears poised to trade with a 106 handle, which it hasn't seen since 01-May.

U.S. Dollar Index Daily Chart

Hawkish FedSpeak from Fed Governor Bowman yesterday suggested there may not be a Fed rate cut at all this year. In fact, Bowman indicated she was willing to raise rates if progress on inflation stalls or reverses. 

We'll get to see the Fed's favored measure of inflation on Friday. Expectations are that the chain price index for May will be unchanged, with perhaps a 0.1% increase ex-food & energy.

Fed Governor Cook said it would be appropriate to cut rates "at some point." It doesn't get much more non-committal with regard to timing than that. Certainly, it was not enough to offset Bowman's comments. Neither was the decline in Jun consumer confidence nor a weak Richmond Fed Index.

The Japanese yen has fallen to its lowest level since 1986 against the dollar, putting the market on alert for more BoJ supportive intervention. While the BoJ has recently hiked rates, they remain near zero making carry trades extremely enticing. Borrow at near-zero rates in Japan and invest in U.S. Treasuries that are yielding 4.25% to 5.49%. Seems like a no-brainer.

Japan narrowly avoided a recession last year, eking out 0.4% growth in Q4-23. However, the economy contracted at a 1.8% annualized rate in the first quarter of this year. While Japan returned to growth in Q2 (JCER forecasts +2.19%), the IMF projects 2024 GDP to be just +0.9%.

Japan's aging population and low birth rate are weighing on productivity and economic growth. This is a macro trend that Japan will have to contend with for some time.

The yuan also continues to weaken as the Chinese 10-year bond yield fell to a 22-year low. The PBoC lowered the reference rate for the yuan to 7.1248. It was the sixth consecutive cut.

ECB Governing Council member Rehn said that market data implies two more rate cuts this year. "In my view, they are reasonable expectations," said Rehn. The ECB's Panetta stressed that policy must remain data-dependent, noting that "political and geopolitical risks remain high."

Aside from a developing overbought condition, there seems to be little standing in the way of the greenback. The high for the year in the dollar index at 106.52 is within striking distance. A breach of that level would put the COVID-era high at 114.78 (Sep-2022) in play.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$11.26 (-0.49%)

5-Day Change: -$15.15 (-0.65%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34
Weighted Alpha: +21.50

Gold slid to fresh 2-week lows in overseas trading and losses have extended early in the U.S. session. The market is still reeling somewhat from Bowman's comments yesterday, and the yellow metal's historic inverse relationship with the dollar may be re-exerting itself.



Gold had shown remarkable resilience in the face of higher interest rates and a strong dollar throughout the Fed's tightening cycle. Gains since Feb were largely the result of expectations that the Fed was on the verge of pivoting toward looser policy.

Gold set a record high on 12-Apr at $2,427.00, just days before the dollar index reached its high for the year (thus far) of 106.62. Gold went on to set another record on 20-May at $2,449.34. Even now, gold is just 6% off that all-time high.

Nonetheless, the short-term outlook has dimmed this week. The breach of support at $2,296.92 (13-Jun low) leaves the more important $2,287.64 (07-Jun) and $2,281.97 (01-May) lows vulnerable to challenges. A case can be made for a head-and-shoulders top on the daily chart with a line drawn between those lows defining a slightly upsloping neckline.

It seems unlikely that the bears will be able to take out this formidable chart level ahead of important inflation data on Friday. However, if inflation comes in hotter-than-expected further losses would be likely. Below $2,281.97 there's not much in the way of support until $2,206.03 based on a Fibonacci retracement.

Inflation at or below expectations would bode well for a rebound into the range. A short-term move above $2,334.36/$2,326.64 would ease pressure on the downside.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$0.044 (-0.15%)
5-Day Change: -$1.001 (-3.36%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379
Weighted Alpha: +29.22

Silver is leading the metals lower in U.S. trading. The white metal has fallen to a fresh 6-week low at $28.618.



The next level of support I'm watching is $28.467 (61.8% retracement of the leg up from $26.049 to $32.379). The lower limits of a bearish channel will come in just below $28 by the time Friday's important inflation data are released.

On the optimistic side, looking at the daily and weekly charts, that bear channel has the earmarks of a bull flag. A word of caution though, the lower limits may need to survive another test and there needs to be considerable upside retracement to build confidence in this chart pattern.

The halfway back point of the decline from last week's high at $30.824 comes in at $29.05. I'd like to see this level regained to shift focus to Monday's high at $29.714 and the upper reaches of the bear channel/bull flag which are just above $30 through the end of the week.

The Royal Canadian Mint published a piece this week highlighting silver's role in the green economy. The article features data previously mentioned in this newsletter that shows strong demand for silver for use in applications such as solar panels, EVs, hydrogen fuels, 5G networks, and water purification. This demand exceeds the available supply, providing a significant long-term tailwind for silver.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, June 25, 2024 10:26:08 AM America/Chicago

6/25/2024

Gold and silver retreat on hawkish FedSpeak

OUTSIDE MARKET DEVELOPMENTS
: The Chinese yuan remains under pressure, falling to a 7-month low against the dollar. This puts the tightly controlled currency within striking distance of lows not seen since 2008.

The world's second-largest economy has yet to fully recover from the COVID-era, leading investors to reallocate funds elsewhere. The U.S. has been a particularly attractive destination due to high yields and strong stock market.

Businesses in China are hoarding dollars on expectations that the downtrend in the yuan will continue. They are also worried about the upcoming U.S. election and the implications for tougher trade policies should Donald Trump win.

Weakness in the euro is also helping to underpin the dollar amid diverging central bank policy. The ECB cut rates for the first time in 5 years on 06-Jun. Today the ECB's Isabel Schnabel downplayed the divergent policy as "slight" and "temporary." The differential between the ECB's deposit rate of 3.75% and the midpoint of the Fed funds target range is 162.5 basis points. That's significant.

Fed Governor Michelle Bowman said she doesn't anticipate any U.S. rate cuts this year. Rather she projects rate cuts in 2025 if inflation continues to moderate. She remains open to a rate hike should price risks escalate. “I remain willing to raise the target range for the federal funds rate at a future meeting should progress on inflation stall or even reverse,” Bowman said.

The S&P Case-Shiller home price index rose 1.4% to a new record high of 329.78 in Apr. The FHFA home price index rose 0.2% to 424.3 in Apr, also an all-time high. The unwillingness of U.S. homeowners to give up their low mortgage rates is keeping supply tight and underpinning prices.

The Chicago Fed National Activity Index rose to 0.18 in May from a negatively revised -0.26 in Apr.

Consumer Confidence and the Richmond Fed Index are out later this morning. We'll also get FedSpeak from Cook and Bowman will speak again.


GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$1.39 (+0.06%)

5-Day Change: -$0.64 (-0.03%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34
Weighted Alpha: +22.64

Gold fell to fresh intraday lows after Fed Governor Bowman said she did not expect any rate cuts this year and suggested a rate hike was not off the table. Treasuries retreated in reaction, but the dollar index remains higher on the day thus far.



Chinese yuan weakness makes gold an attractive investment in the world's largest gold-consuming nation. It was the top-performing RMB-denominated asset through May with a return of more than 15%. Gold-backed ETFs saw inflows of RMB1.8bn (US$253mn) in May.

Bar and coin demand cooled in May due to record-high prices and high premiums. While the current level is arguably more attractive and premiums have moderated, some may be waiting for an even lower price. Nonetheless, I suspect that persistent yuan weakness and concerns ahead of the U.S. election will lead to improved physical demand in China.

The market is also eagerly anticipating any news on PBoC gold purchases in June. Was May's pause a one-off or is something more significant happening?

Last Friday's low at $2,317.85 marks initial support. Additional barriers are noted at $2,307.45 (18-Jun low), and $2,296.92 (13-Jun low) which protect the more important $2,287.64 low from 07-Jun.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.027 (-0.09%)
5-Day Change: -$0.036 (-0.12%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379
Weighted Alpha: +33.87

Silver tumbled to new 5-session lows on this morning's hawkish FedSpeak. The inability of the white metal to regain $30 in the wake of last Friday's sell-off leaves the downside vulnerable in the short term.



I wrote yesterday that strength in the U.S. manufacturing sector should provide support to silver. However, growth risks in China may be an offsetting factor.

China's GDP grew at a 5.3% annualized pace in Q1. This better-than-expected performance prompted the IMF to upgrade its 2024 projection to 5.0% from 4.6% previously. Q2 forecasts are generally right around 5.0%.

However, government stimulus efforts don't seem to be working particularly well in the face of an ongoing property crisis and demographic pressures. The IMF warns that China's GDP could drop to 3.3% by 2029 due to an aging population and reduced productivity.

The violation of support marked by yesterday's low at $29.356 leaves $29.022 (18-Jun low) vulnerable to a challenge. The latter protects the more important $28.719 low from 13-Jun.

A rebound above $29.422 would ease intraday pressure on the downside, but $30 must still be regained to set a more positive short-term tone. Today's earlier high and Monday's high at $29.645/$29.714 respectively provide an intervening barrier.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, June 24, 2024 10:16:50 AM America/Chicago

6/24/2024

Gold and silver pare last week's losses with a focus on incoming data and the Fed

OUTSIDE MARKET DEVELOPMENTS
: Focus this week will be on May personal income and PCE data out on Friday. Median expectations favor a 0.4% increase in income and a 0.3% rise in spending. Most importantly, consensus on the price index is unch.

Fed funds futures continue to show that the market believes there is about a 60% chance that the Fed will cut rates at the September FOMC meeting. This defies the dot plot from the June meeting and recent FedSpeak that has tended toward "higher-for-longer."

We'll hear more FedSpeak this week from Waller, Daly Bowman, Cook, and Barkin.

Last week's PMI beats reflect the resiliency of the U.S. economy, which is underpinning the dollar. While there have been some negligible signs of cracks in the labor market, above-target inflation remains the Fed's primary concern.

The first of two presidential debates between Joe Biden and Donald Trump will happen on Thursday. Polling continues to show that the race is very tight, so the performances of the candidates could have a material impact on the outcome.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$4.41 (+0.19%)

5-Day Change: +$6.92 (+0.30%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold ended last week with a loss of 0.5% after gains acquired earlier in the week evaporated on Friday. The yellow metal was weighed by diminished expectations of two rate cuts this year on the heels of better-than-expected PMI data.



Friday's price action prevented a second consecutive higher weekly close, raising some concerns within the bull camp. However, important support marked by the 07-Jun low at $2,287.64 remains well protected. Intervening barriers are noted at $2,317.85 (Friday's low), $2,307.45 (18-Jun low), and $2,296.92 (13-Jun low).

Indian gold demand subsided following the Akshaya Tritiya festival in May according to the World Gold Council. While buying bested expectations during the festival, it quickly waned due largely to near-record prices.

Overall, the Indian gold market appears robust with the WGC acknowledging strong RBI interest, rising ETF inflows, and a steady uptrend in gold imports. The RBI has added 30.6 tonnes of gold to reserves YTD, bringing total holdings to a record high of 834.2 tonnes.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.052 (+0.18%)
5-Day Change: +$0.151 (+0.51%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver is trading modestly higher on the day, retracing some of the sharp losses seen on Friday. Like gold, the white metal succumbed at the end of last week to selling pressures stemming from the PMI beats. Silver ended last week down a scant 0.1%.



However, the signal that the U.S. manufacturing sector remains strong is arguably a positive for silver. Industrial demand was 55% of overall demand in 2023, according to The Silver Institute.

Total silver demand rose 7% last year to 1,154 Moz. Total industrial demand was 654.4 Moz, led by the electrical and electronics sector. Total supply was 1,011 Moz resulting in a structural deficit of 184 Moz.

The Silver Institute projects a 2% rise in demand this year, with a 1% dip in supply. That would result in a fourth consecutive deficit.

The supply/demand fundamentals remain broadly supportive for silver, favoring the 4-year uptrend that began with the $11.703 low in March 2020. Gains since that low have been as much as 176.7%. I think this market is still good, although further short-term corrective/consolidative price action can not be ruled out.

The overseas low at $29.356 defines initial support, which protects $29.022 (18-Jun low) and the important $28.719 low from 13-Jun.

Friday's high at $30.824 is now the level to watch on the upside. A climb back above $30 would be an encouraging technical signal. 


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, June 21, 2024 10:33:34 AM America/Chicago

6/21/2024

Gold and silver tumble intraday on solid U.S. PMI readings

OUTSIDE MARKET DEVELOPMENTS
: Weak PMI data in Europe and the UK have weighed on the euro and pound respectively. The euro is threatening the 7-week low set against the dollar last week at 1.0667 on bets that further ECB rate cuts are in store to temper rising growth risks.

While the BoE held steady earlier in the week, a rate cut is widely believed to be in the offing. Sterling slid to a 5-week low of 1.2631 versus the dollar.

The gist of FedSpeak this week has been that while we're moving in the right direction, getting inflation back to the 2% target will take some time, and patience is required. This messaging combined with more dovish stances overseas is underpinning the dollar. The dollar index jumped to a fresh 7-week high, buoyed by weakness in the euro and pound.

The markets however continue to like the idea of two rate cuts this year. Fed funds future still put the probability of a Sep cut at around 60%. Former St. Louis Fed President Bullard said he sees two rate cuts this year. During his time on the FOMC, Bullard was one of its more hawkish members.

U.S. S&P flash manufacturing PMI rose to 51.7 for Jun on expectations of 51.0, versus 51.3 in May. The services PMI print was 55.1, above expectations of 54.0, versus 54.8 in May. These data offset some of the signs of weakness seen yesterday and will likely temper Sep rate cut expectations.

Leading indicators (-0.4% expected) and the Dallas Fed Index come out later this morning. 


GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +4.03 (+0.17%)

5-Day Change: +33.81 (+1.45%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold was sustaining yesterday's gains into early U.S. trading, but rotated lower on the day following better-than-expected U.S. PMI data. A second consecutive higher weekly close is suddenly in jeopardy. The yellow metal must end the session above $2,333.05 to preserve the higher weekly close.



It looks like some of the bets on two rate hikes that were put on yesterday are now getting unwound. A breach of yesterday's low at $2,328.18 would create an outside day and would be troubling from a technical perspective.

The fact that the 07-Jun low at $2,287.64 has held for two weeks was encouraging for the bull camp. The magnitude of retracement seen through overseas trading bolstered the notion that the corrective low was in place. However, price action today suggests the bears still have some sway in the short term.

That doesn't necessarily mean new cycle lows, but possibly more consolidative trading within the range set on 07-Jun. Where we end today's session and early action next week will tell us a lot.

Perhaps not surprisingly there were 12 tonnes of North American outflows from gold-backed ETFs last week. This happened in the wake of the near-$100 sell-off of 07-Jun. Inflows from Europe were 7 tonnes amid rising economic and political concerns. The net change for the week was -4.6 tonnes.



Czech National Bank Governor Michl wants to grow the central bank's gold holdings from its current 40 tonnes to 100 tonnes over the next 5 years. This desire is consistent with the well-defined trend of robust central bank gold-buying that is expected to continue.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$0.281 (-0.91%)
5-Day Change: +0.961 (+3.25%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver tumbled on the solid PMI data, following gold lower. Nearly all of yesterday's gains have been retraced and the $29.716 low has been pressured. It seems like a strong U.S. manufacturing sector would be good news for silver, as the white metal derives most of its demand from industrial applications, primarily electronics.



Like gold, if yesterday's low is exceeded an outside day will be confirmed. An outside day with a lower close is a rather negative chart formation. Nonetheless, barring a complete rout, silver looks like it will still notch a second consecutive higher weekly close.

Today's close will be telling from a technical perspective.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, June 20, 2024 10:56:36 AM America/Chicago

6/20/2024

The precious metals surged to 2-week highs despite dollar strength

OUTSIDE MARKET DEVELOPMENTS
: The Bank of England held steady on rates by a vote of 7-2. That's one more dissenter than at the May MPC meeting, suggesting the BoE is moving cautiously toward that first rate cut. For now, the bank rate remains at 5.25%.

The policy summary noted, "The restrictive stance of monetary policy is weighing on activity in the real economy, is leading to a looser labour market and is bearing down on inflationary pressures. Key indicators of inflation persistence have continued to moderate, although they remain elevated."

The Swiss National Bank surprised with their second rate cut. The policy rate now stands at 1.25%. "[U]nderlying inflationary pressure has decreased again compared to the previous quarter" according to the statement.

Norges Bank also announced policy today. They left the policy rate unchanged at 4.5% which was widely expected. 

U.S. initial jobless claims fell 5k to 238k in the week ended 15-Jun on expectations of 233k. That's down from a 10-month high of 243k in the previous week. Continuing claims jumped 15k to a 5-month high of 1,828k.

U.S. Housing Starts tumbled 5.5% to 1.277M in May, well below market expectations of 1.382M, versus a negatively revised 1.352M in Apr.

The Philly Fed Index dropped to a 5-month low of 1.3 in Jun, well below market expectations of 4.0, versus 4.5 in May. That's down significantly from the 2-year high of 15.4 seen in Apr. The ISM-adjusted index rose modestly from April's 4-month low of 47.2 to 47.6.

Despite the generally disappointing U.S. data, Treasury yields are rising today, providing a lift for the dollar. Minneapolis Fed President Kashkari made note of the resilience of the U.S. economy and said it may take a year or two to bring inflation down to the 2% target. Kashkari is a moderate hawk and I would categorize that statement as moderately hawkish, consistent with 'higher-for-longer' messaging.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +11.36 (+0.49%)

5-Day Change: +35.84 (+1.56%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold jumped to 2-week highs in overseas trading and extended those gains early in the US. session. Generally soft U.S. data have bolstered expectations that the Fed is on the verge of pivoting. While today's SNB cut and the BoE's 'dovish-hold' seem friendly to that line of thinking, FedSpeak continues to slant hawkish.



More than 61.8% of the near-$100 plunge on 07-Jun has now been retraced. The next retracement level is at $2,365.66 (78.6%). Beyond that, focus shifts back to the 07-Jun high at $2,386.90.

Israel has warned of the potential for "all-out war" in Lebanon following threats from Hezbollah. Israel's Foreign Minister said earlier in the week that "operational plans for an offensive in Lebanon were approved and validated."

The prospects for a widening conflict in the region are driving safe-haven interest in gold. Hezbollah also threatened Cyprus, warning that allowing Israel to use Cypriot airports and bases would be dealt with as "part of the war."

A Global Trade Research Initiative (GTRI) report revealed that India agreed to import 200 metric tonnes of gold annually from the UAE with a 1% tariff concession as part of a trade agreement signed in 2022. This drove a 147.6% surge in gold imports from $3 bln in FY23 to $7.6 bln in FY24.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.498(+1.67%)
5-Day Change: +1.388 (+4.79%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver surged back above $30 in overseas trading, taking out resistance at $30.169 (last week's high). Gains mounted in early U.S. trading after soft economic data heightened prospects for a sooner-than-later Fed rate cut.



More than 61.8% of the decline off the 07-Jun high at $31.516 to the 13-Jun low at $28.719 has now been retraced. Short-term focus is now on the 78.6% retracement level at $30.917. Above that, $31.516 is back in play.

Former resistance at $30.169 now marks initial support. This level is reinforced by the U.S. session low at $30.104.

The aforementioned GTRI report showed a 60x increase in silver imports from the UAE from $29.2M in FY23 to $1.74 bln in FY24. Not surprisingly, Indian importers like the 8% duty on UAE silver far better than the 15% duty on imports from other nations.

In fact, the tariff differential makes UAE silver cheaper even though they are not a producer. The UAE is a processor of silver, importing large bars and converting them to grain (shot) for export.

India is now concerned about lost tariff revenue and the arbitrage opportunity of their own making.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, June 18, 2024 10:04:44 AM America/Chicago

6/18/2024

Gold caught a bid following weak retail sales data as U.S. yields and the dollar fell

OUTSIDE MARKET DEVELOPMENTS
: FedSpeak on Monday generally affirmed the likelihood of a single rate cut this year. Philly Fed President Harker warned that no cuts or two cuts were also possibilities, depending on incoming data.

There's more FedSpeak on the calendar for today from Cook, Barkin, Collins, Logan, Kugler, Musalem, and Goolsbee.

Fed funds futures show that the market continues to lean toward two cuts, the first in September and then again in November. This scenario was reinforced today by weak U.S. retail sales data.

U.S. retail sales rose 0.1% in May, below expectations of +0.3%, versus a negatively revised -0.2% in Apr. Ex-auto fell 0.1% on expectations of +0.2%, versus a negatively revised -0.1% in Apr.

U.S. yields and the dollar fell in reaction, providing some intraday support for the precious metals.

U.S. industrial production for May comes out later this morning. Median expectations are +0.4%. Capacity utilization increased to 78.7% in May, just above expectations of 78.6%, versus a negatively revised 78.2% in Apr.

U.S. business inventories for Apr are expected to come in at +0.3%.

The RBA held steady on policy in line with expectations. Governor Bullock expressed some uncertainty in the presser amid simultaneous growth and price risks. "Earlier on when we were raising rates it was quite obvious what we had to do. It's not so obvious now," she said.
 
The PBoC held steady on policy earlier in the week. This was also widely expected as the Chinese central bank is constrained by a weak yuan.

GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$10.63 (-0.46%)

5-Day Change: -3.35 (-0.14%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold started the U.S. session on the defensive having set a new low for the week overseas, but price action remains confined to Friday's range. The yellow metal caught a bid following the weak retail sales data as U.S. yields and the dollar fell.



Softness in the consumer sector can ease price pressures but is a harbinger of mounting growth risks. As the Fed is data-dependent, it will be interesting to hear the tenor of today's FedSpeak. Fed funds futures now put the odds of a 25 bps rate cut in Sep at 60%. That's up from 56.7% yesterday and 46.8% a week ago.

Nearby supports and resistances remain unchanged from yesterday.

I'm watching the low from 13-Jun at $2.296.92 on the downside to keep the more important $2,289.43/$2,287.64 lows at bay.

On the upside, the overseas high at $2,325.23 protects Friday's high at $2,334.92 and last week's high at $2,339.48.

The World Gold Council's latest Central Bank Gold Survey revealed that 29% of survey respondents said they "intend to increase their gold reserves in the next twelve months." That's the highest level the WGC has observed since the survey began in 2018. The survey also shows that 81% of respondents believe global central bank gold holdings will increase over the next 12 months.



This certainly takes some of the sting out of the news from 07-Jun that China's PBoC had bought no gold in May. It is likely that they only paused their buying. The survey results reinforce my expectation that global central banks will continue to expand their gold reserves amid "an increasingly complex geopolitical and financial environment."


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$0.332 (-1.13%)
5-Day Change: -0.082 (-0.28%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver has formed an outside day, exceeding both yesterday's high and low. The $29 zone has attracted buying interest in recent weeks.



Today's retail sales miss prompted an intraday rebound as the dollar retreated. However, weaker demand for consumer electronics and cars could be seen as a negative for silver.

At this point, last week's low of $28.719 remains protected by Friday's low of $28.887. Fresh highs today would be encouraging, shifting focus to last week's high at $30.169.

BofA remains bullish on silver, targeting $35 within the next 2 years. They see the global economy "turning the corner," which will not only increase industrial demand for the white metal but pull investors into the market.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

 



           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, June 17, 2024 9:47:06 AM America/Chicago

6/17/2024

The precious metals start the week easier after notching higher closes last week

OUTSIDE MARKET DEVELOPMENTS
: Consolidative trading prevails for the precious metals as the market awaits a host of FedSpeak this week. Minneapolis Fed President KAshkari said over the weekend that a single rate cut this year was a “reasonable prediction.”

Additional FedSpeak is due from Williams, Harker, and Cook today. The calendar is chock-full of Fed speakers this week. I suspect the message will be largely consistent: One rate cut this year, probably in November, but it's all data-dependent.

Policy decisions are on tap this week for the BoE, SNB, RBA, PBoC, and Bank Indonesia. While the global bias is toward easing, timing remains dependent on perceived progress toward taming inflation and maintaining jobs growth.

U.S. calendar highlights include May retail sales (+0.3% expected) and IP (+0.4% expected) on Tuesday. Flash PMIs come out on Friday. Initial jobless claims will also be closely watched on Thursday, given the 10-month high of 242k seen in the last report. 

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -12.56 (-0.54%)

5-Day Change: +8.41 (+0.36%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold ended higher last week, breaking a string of three consecutive lower weekly closes. Price action was choppy, but confined to the previous week's range, leaving the $2,287.64 low from 07-Jun intact.



The yellow metal begins this week on its back foot and still appears vulnerable to further tests of the downside with the dollar holding firm. Gold may be forming a base here, or staging for another leg down. The low from 13-Jun at $2.296.92 protects more important support marked by the  $2,289.43/$2,287.64 lows.

First resistance is marked by Friday's high at $2,334.92, which stands in front of last week's high at $2,339.48. Penetation of the latter would highlight $2348.98 initially, but such a move would make the 07-Jun high at $2,386.90 look attractive.

RBI data revealed that India's forex reserves reached a record $655.8 bln in the week ended 07-Jun. Gold reserves rose by $481 million to $57 bln.

The sharp sell-off on 07-Jun was triggered by news that China's central bank hadn't bought any gold in May. Central bank gold buying is expected to remain a major source of demand, even if the PBoC has paused their buying.

The latest COT report for the week ended 14-Jun shows that net spec positions in gold dipped to 233.9k, versus 237.3k in the previous week. 


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$0.322 (-1.09%)
5-Day Change: -0.473 (-1.59%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver closed higher last week, but not before setting a 4-week low at $28.719. The lower low and higher close result in a simple reversal on the weekly chart, but the white metal is defensive early in the new week. Price action remains confined to Friday's range thus far.



Recent losses are still seen as corrective within the longer-term uptrend. While dips below $29 have generated some buying interest, momentum on the upside has failed to impress, suggesting that the low is not in yet.

Geopolitical tensions surrounding China's EV exports may be damping demand amid worries of a trade war. Additionally, the recent lurch right in the EU parliament may temper aggressive low-carbon benchmarks in Europe, which currently include banning ICE vehicle sales by 2035.

A less aggressive push toward EV and solar adoption could somewhat lessen the demand for silver, but I doubt it will materially alleviate the current supply deficit. This could however be a positive for platinum and palladium, which are used in the catalytic converters of ICE vehicles to reduce emissions.

U.S. Mint data show that demand for silver coins remained robust in May. A total of 1.75Moz of silver coins were sold in May, a rise of 9.7% y/y. Year-to-date sales now stand at 12.6Moz. +52% versus this time last year.

The latest COT report for the week ended 14-Jun shows that net spec positions in silver dipped to 51.7k, versus 56.4k in the previous week. 


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, June 14, 2024 10:19:16 AM America/Chicago

6/14/2024

Gold is poised for its first higher weekly close in four

OUTSIDE MARKET DEVELOPMENTS
: French stocks are leading European markets lower amid mounting political uncertainty. The CAC index is down more than 2% today and is now trading lower on the year.

Concerns are rising that French President Macron's gamble to call snap elections will propel the National Rally (RN) party to a majority in France's National Assembly. The RN saw strong gains in the recent EU Parliament election. If the RN takes control of the French government, some worry that they will launch unsustainable fiscal spending.

Risk aversion in Europe is on the rise, which is helping both the dollar and gold. 

The BoJ held steady on rates, as was widely expected. They also indicated that they would reduce bond buying over the next 1 to 2 years. Details of that plan are expected to be revealed in July.

Favorable U.S. inflation data seems to be offsetting the reduction of Fed rate cut expectations to some degree. Yesterday's PPI report saw the largest decline since October. Both import and export price indexes for May declined more than expected this morning, -0.4% and -0.6% respectively.

While the Fed now projects just a single rate cut this year, down from a projection of three from the March FOMC meeting, policy remains data-dependent. Fed funds futures continue to show November as the most likely meeting for that cut.

However, further signs that inflation is moving back toward the Fed's 2% target, and/or indications of weakness in the labor market will see an increase in bets for a rate cut in September. The probability of a Sep rate cut currently stands at 61.1%.

The World Bank raised its 2024 global growth outlook to 2.6%, up from a 2.4% projection in January. This upgrade comes largely due to the resilience of the U.S. economy. “U.S. growth is exceptional,’’ said Ayhan Kose, the World Bank’s deputy chief economist.

"Exceptional" seems a bit dramatic given the tumble in Q1 GDP to 1.3%, versus 3.4% in Q4-23. However, growth is expected to accelerate to 2.5% in Q2.

GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +25.98 (+1.13%)

5-Day Change: +$38.10 (+1.66%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold continues to trade in a choppy manner in the lower half of last Friday's big $99 range. A close above $2,293.71 (07-Jun close) seems likely at this point, which would confirm the first higher weekly close in 4 weeks.



There were solid inflows of 12.1 tonnes into gold ETFs last week. North America and Europe led the charge with +4.4 tonnes each. The appetite of European investors for gold remains strong, spurred by political and economic uncertainty that has led to risk aversion. The sharply lower price at the end of last week likely contributed.



The underlying fundamentals in the gold market remain broadly supportive, and the longer-term trend is still decidedly bullish with the yellow metal less than 5% off the record high of $2,449.34 that was set less than a month ago.

A number of analysts have reiterated their bullish outlooks and suggested buying the dip. However, it is not a foregone conclusion that the corrective low is in place.

A higher weekly close today would be encouraging. A breach of Wednesday's high at $2,339.48 would be better yet. Secondary resistance is marked by the 61.8% retracement level of last Friday's plunge at $2348.98.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.291 (+1.00%)
5-Day Change: +$0.046 (+0.16%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver is trading higher on the day, but generally consolidative at the low end of yesterday's range. While gold has been able to hold last Friday's low, the white metal extended losses on Thursday to set a fresh 4-week low at $28.719. 



Silver needs to close above $29.172 to record a higher weekly close. However, a convincing move back above $30 and a breach of Wednesday's high at $30.169 is needed to ease short-term pressure on the downside.

However, at this point, a challenge of support at $28.467 (61.8% retracement of the leg-up from $26.049 to $32.379) can not be ruled out. The overseas low at $28.887 offers an intervening barrier ahead of Thursday's low at $28.719. 

Prospects for stronger economic growth in H2 should help underpin silver, as it derives the majority of demand from industrial applications. A resumption of the uptrend in gold should also help, as silver offers a less expensive alternative to the yellow metal as a means of portfolio diversification.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, June 13, 2024 10:20:15 AM America/Chicago

6/13/2024

'Higher for longer' signal from Fed weighs on precious metals

OUTSIDE MARKET DEVELOPMENTS
: The precious metals are back on the defensive after the Fed signaled on Wednesday that rates would stay higher for longer. Changes to the dot plot for the appropriate target range for the Fed funds rate now indicate just one rate cut this year, down from a projection of three cuts in March.

Fed Chairman Powell acknowledged that there has indeed been significant progress toward lowering inflation to the 2% target, but that inflation remains too high. “We’ll need to see more good data to bolster our confidence that inflation is moving sustainably toward 2%,” said Powell.

Today's PPI print offers some additional evidence in that regard. PPI for May came in at -0.2%, below expectations of +0.1%, versus +0.5% in April. Annualized PPI edged down to 2.2% from a revised 2.3% in April. Core PPI was unchanged on expectations of +0.3%, versus +0.5% in April; 2.3% y/y.

Initial jobless claims rose 13k to a 10-month high of 242k in the week ended 08-Jun. Continuing claims jumped 30k to a 6-month high of 1,820k. While the labor market has remained largely resilient, as evidenced by last week's payrolls beat, we see some potential cracks forming.

Yields spiked overnight in Europe driving stocks lower as concerns about sticky core inflation alter expectations for further ECB rate cuts. The Fed's 'hawkish hold' is also seen as a limiting factor for the ECB.

The EU Commission announced tariffs on Chinese electric cars of up to 38%, following the lead of the U.S., based on what they perceive to be unfair subsidies from Beijing. A response from China seems likely, raising risks of a trade war.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -7.60 (-0.33%)

5-Day Change: -67.89 (-2.86%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold is holding above $2,300 but price action remains choppy, generally in the lower half of last Friday's large $99 range. The yellow metal caught a bid from the unexpected drop in May PPI and higher-than-expected initial jobless claims, as both can be viewed as evidence that a rate cut is warranted sooner rather than later.



However, the Fed provided a clear signal yesterday that they're thinking 'higher for longer' which would pose up to a medium-term headwind for gold. The Fed indicated that a single rate cut is now likely this year, down from a projection of three cuts at the time of the March FOMC meeting.

I suspect the hawkish Fed bias will keep at least short-term focus on the downside or at lease ongoing base-building. The breach of support marked by Wednesday's low at $2,311.36 leaves Tuesday's low at $2,298.90 vulnerable to a retest. Penetration of the latter would return focus to the $2,289.43/$2,287.64 lows.

Fresh cycle lows in silver today are seen as an additional weighing factor on gold.

Geopolitical and economic uncertainties will continue to provide longer-term underpinning for the gold market. As will central bank gold demand, even if the PBoC has paused its buying.

Minor intraday chart resistance is noted at $2,324.60. Yesterday's high at $2,339.48 is the more important level to watch on the upside.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$0.463 (-1.56%)
5-Day Change: -2.197 (-7.02%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver fell to another new 4-week low of $28.963, weighed by EU tariffs on Chinese EVs and a surprise decline in Eurozone industrial production in April.



Electric vehicles are a major source of silver demand, using up to twice as much metal as internal combustion vehicles. Making Chinese EVs more expensive in Europe (and America) could reduce demand.

The contraction in EU industrial production accelerated to -3.0% y/y in April, versus a revised -1.2% in March.

While the white metal rebounded into the range intraday, the downside remains vulnerable with scope for a test of $28.467 (61.8% retracement of the leg-up from $26.049 to $32.379). Today's earlier low at $28.963 provides intervening support.

The halfway-back point of the decline off of Friday's high at $31.516 is recalculated as $30.190. This level is reinforced by Wednesday's high at $30.169.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

Trading OTC markets involves significant risk of loss.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, June 12, 2024 9:45:54 AM America/Chicago

6/12/2024

Gold and silver firm in early U.S. trading on unch CPI print

OUTSIDE MARKET DEVELOPMENTS
: The precious metals caught a bid in early U.S. trading after May CPI came in unchanged, just below expectations of +0.1%. However, price action remains broadly consolidative in the wake of last Friday's sharp sell-off.

Annualized CPI edged down to 3.3%, from 3.4% in April. Core CPI was +0.2% in May on expectations of +0.3%; +3.4% y/y, versus 3.6% in April.

These data will likely reinforce the notion that the Fed is making progress on inflation and will have room to cut rates later this year, even amid persistent strength in the labor market. The prospects for a rate cut in September are back on the rise and currently stand at 59.9% based on Fed funds futures.

The 2-day FOMC meeting ends today and policy will be announced at 1:00PM CDT this afternoon. Steady policy is widely expected. The statement and Powell's presser will be closely monitored for clues as to the likely policy path in H2.

PPI comes out tomorrow. Median expectations are +0.1%. Core PPI is expected to come in at +0.3%.

GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$3.09 (-0.13%)

5-Day Change: -41.67 (-1.77%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold was under modest pressure at the beginning of the U.S. session, but jumped in reaction to the below-expectations CPI print. The yellow metal is up for a third consecutive day, and more than half of Friday's plunge has now been retraced.



Earlier this week, I had deemed that 50% retracement level at $2,337.27 as important short-term resistance. Focus now shifts to the 61.8% retracement level at $2348.98.

A measure of confidence has been returned to the underlying uptrend, but the market is unlikely to prosecute the breach of $2,337.27 until after Fed policy is announced. Softer-than-expected consumer inflation is already pulling rate-cut expectations back toward the present, but the Fed could temper those expectations with a more hawkish tenor later today.

There is also PPI to worry about tomorrow.

Reuters reports that demand for gold remains strong in Asia, despite near-record high prices. Asian buyers are primarily seeking to hedge geopolitical and economic uncertainty, which has led to lower confidence in other investments such as stocks and real estate.

"The trend in the market has been that if the consumer wants to buy gold, they will. The price doesn't matter." – Albert Cheng, CEO of the Singapore Bullion Market Association

India remains an exception, due to price sensitivity. Indian gold demand has fallen to a 3-year low, although the recent setback in the price of gold has seen some buyers return.

Wells Fargo and UBS have reiterated their bullish outlook on gold. Buy the dips is the strategy according to UBS.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.111 (+0.38%)
5-Day Change: -0.591 (-1.97%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver rallied to new highs for the week in reaction to the CPI print. Trades back above $30 are encouraging, but unlike gold, the midpoint of Friday's range in silver at $30.331 remains protected at this point.



The 61.8% retracement level of the decline from Friday's high to Tuesday's low at $29.098 comes in at $30.592. A minor chart point is noted at $30.825.

I suspect the intraday range has been set at this point. Barring a dovish surprise from the Fed later today, further tests of the downside can not be ruled out.

The underlying trend remains decidedly bullish, with the fundamentals broadly supportive. Therefore recent losses are considered corrective in nature. What is in doubt is whether the corrective low is in place at $29.098 or not.

 

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Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, June 11, 2024 9:07:32 AM America/Chicago

6/11/2024

Gold continues to consolidate Friday's sharp losses

OUTSIDE MARKET DEVELOPMENTS
: The precious metals market continues to assess the implications of Friday's news that the PBoC did not buy any gold in May. While China had added to official reserves for 18 consecutive months through April, buying in April was only 2 tonnes. That was well below their average purchase of 18 tonnes going back to Nov 2022.



Based on the chart above, it's obviously not uncommon for China to hold steady on gold reserves for extended periods. The market will eagerly anticipate June data to see if China's reserves remain at 2264 tonnes.

A number of central banks have been participating in the gold-buying spree so far this year. Turkey has actually been leading the charge. China was number 2 in terms of YTD volume through April. India, Kazakhstan, and Singapore round out the top 5.

With or without PBoC participation, central bank buying is likely to remain an important theme with regard to the underlying bull trend in gold.

Conservatives made gains in the recent EU Parliamentary elections, based in large part on voters' growing concerns about mass immigration. French President Macron reacted by dissolving the General Assembly and calling for a snap election. This may be an attempt by Macron to re-consolidate his power, but there is a risk that it will backfire. 

There is growing speculation that gains by the right in Europe could be a harbinger ahead of U.S. elections in November. Political uncertainty may provide some support for gold in the months ahead.

Look for choppy consolidative trading to prevail – with a bearish bias – ahead of Wednesday's FOMC decision and CPI data. PPI data comes out on Thursday.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -2.94 (-0.13%)

5-Day Change: -18.58 (-0.80%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold continues to consolidate the sharp losses seen on Friday, with a bit of a bid emerging in early U.S. trading that has taken the yellow metal into positive territory for the session.



Initial resistance at $2,315.47/$2,318.36 has been slightly exceeded, leaving $2326.73 vulnerable to a test. The more important level to watch is the midpoint of Friday's range at $2,337.27. Penetration of this level would set a more favorable short-term tone, shifting focus to $2348.98 (61.8% retrace) and then $2,386.90.

However, it seems unlikely in the wake of last week's collapse that the bears won't try and take the market lower again. Today's intraday low at $2,298.90 protects the lows of the previous 2 sessions at $2,289.43/$2,287.64. Key support is marked by the low from 01-May $2,281.97.  


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$0.481 (-1.62%)
5-Day Change: -0.165 (-0.56%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver eked out a new 4-week low of $29.103 in overseas trading, sightly exceeding Friday's low at $29.146. The magnitude of the total decline off the 11-year high at $32.379 (21-May) is now 10.1%.



The lack of downside follow-through is perhaps mildly encouraging, yet further attacks on the downside seem likely. Another round of new lows would confirm potential to $28.467 (61.8% retracement of the leg-up from $26.049 to $32.379).

Initial resistance defined by Monday's high at $29.805 has been reinforced by today's price action. Penetration is needed to call for further retracement of Friday's losses to the midpoint of that range at $30.764.

 

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Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, June 10, 2024 9:32:23 AM America/Chicago

6/010/2024

Gold and silver have recovered somewhat from Friday's rout

OUTSIDE MARKET DEVELOPMENTS
: The precious metals rebounded modestly in overseas trading on Monday, but the sharp losses seen on Friday leave the downside vulnerable.

Gold was initially pressured on Friday by news that China's central bank did not buy any gold in May as the yellow metal reached record highs. China's gold reserves held steady at 2264 tonnes.

The PBoC had bought just under 2 tonnes of gold in April, well below its average of 18 tonnes since they resumed reporting in Nov 2022. Nonetheless, the end of the PBoC's 18-month buying spree caught the market by surprise.

Is this just a pause in PBoC buying, or does this signal a significant policy shift? My bet is on the former as I see reserve diversification remaining a persistent theme in China.

The precious metals were hit again on Friday when U.S. nonfarm payrolls beat expectations. Resilience in the jobs market further reduced the likelihood of a Fed rate hike in September. 

The Fed's 2-day FOMC meeting begins on Tuesday and policy will be announced on Wednesday. Steady policy is widely expected. Investors will be paying close attention to the policy statement, economic projections, and Powell's presser for clues as to when the Fed will start to ease.

U.S. CPI for May comes out on Wednesday and PPI on Thursday. Median expectations are +0.1% for both. The Fed is likely to note progress on inflation, but not enough to warrant a rate cute any time soon.

GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +4.39 (+0.19%)

5-Day Change: -50.69 (-2.16%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold is up modestly from Friday's 5-week low at $2,287.64. Friday's plunge of more than $80 (nearly 3.5%) was the biggest 1-day drop since November 2020. The range on Friday was just shy of $100!



News that China had bought no gold in May combined with a U.S. payrolls beat weighed heavily on the yellow metal. While the May low at $2,281.97 was approached, this important support level remains intact thus far.

The intraday climb back above $2300 eases the immediate pressure on the downside. However, momentum on today's bounce is not terribly impressive, so further tests of the downside must be considered.

Former supports at $2,315.47/$2,318.36 and $2326.73 now provide resistance. These levels protect the more important halfway back point of Friday's range at $2,337.27. A breach of this level would offer some encouragement to the bulls.

While Friday's move and the sharp losses in late May were certainly dramatic, the retreat off the all-time high at $2,449.34 on 20-May to Friday's low is "just" 6.6%. These losses are considered corrective within the longer-term uptrend. 

However, if $2,281.97 (01-May low) gives way, a more protracted corrective phase with potential to $2.204.41/$2,200.00 would become likely.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.547 (+1.88%)
5-Day Change: -0.962 (-3.13%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver is trading at the low end of Friday's large $2.37 range. The sharp losses realized on Friday leave focus squarely on the downside. Intraday upticks have been lackluster in terms of momentum, but they have relieved the short-term oversold condition somewhat. Further tests of the downside are likely. 



The magnitude of the retreat off the 11-year high at $32.379 (21-May) is now almost exactly 10%. Fresh lows would shift focus to the $28.467 (61.8% retracement of the leg-up from $26.049 to $32.379).

A convincing rebound above $30 might encourage the bulls, but I suspect the bears will be sellers ahead of this level. More important resistance at $30.764 (halfway back point of Friday's range) must be cleared to set a more favorable short-term tone.


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Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, June 7, 2024 11:13:08 AM America/Chicago

6/07/2024

Gold tumbles on news that the PBoC didn't buy any gold in May

OUTSIDE MARKET DEVELOPMENTS
: Official data from the People's Bank of China (PBoC) revealed that the central bank had not added any gold to official reserves in May as the yellow metal was making record highs. This apparently ended a buying spree that had lasted 18 consecutive months.

May U.S. nonfarm payrolls significantly beat expectations with a print of +272k. Median expectations were +195k, but there had been whispers of a weaker number based on soft jobs market data that came out earlier in the week. Back-month revisions totalled -15k.

The unemployment rate ticked up to 4.0%, largely due to a 250k drop in the labor force. Hourly earnings rose 0.4%, above expectations of +0.3%, versus +0.2% in April. The average workweek held steady at 34.3 hours.

These generally robust data downgraded rate cut hopes for July and September, putting additional pressure on the precious metals. Fed funds futures continue to suggest that the first Fed rate cut is most likely to come in November.

With the BoC and the ECB having cut rates this week, and hopes for a 'sooner rather than later' Fed cut dashed for the time being, the dollar index rebounded to new highs for the week. Prevailing interest rate differentials should help to underpin the greenback and pose a headwind for the precious metals.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -41.61 (-1.75%)

5-Day Change: -5.23 (-0.22%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold fell sharply in overseas trading as the market was surprised to learn that the PBoC had not bought any gold in May. This understandably rattled the gold market and the weekly gains that had accumulated through early Asian trading were quickly erased.



Of course, the PBoC is rather opaque when it comes to policy matters, including its gold holdings. Is the central bank really on pause? Was May just a one-off aberration? Are they still accumulating gold by other means? There will be much speculation on all these questions in the week ahead.

Net central bank gold purchases had picked up in April, but China was the second-biggest buyer behind Turkey. Without China in the mix, we could see net central bank sales of gold for the first time in a year.

The better-than-expected U.S. jobs report added further weight to gold, as Fed rate cut hopes dimmed and the dollar rose. The yellow metal tumbled to a new low for the week. Not only do we have an outside trading day, but an outside trading week as well.

If gold closes lower today, which seems likely, it will be the third consecutive lower weekly close since the record high of $2,449.34 was established on 20-May. None of this is terribly encouraging from a technical perspective, but keep in mind that gold is only off 5.7% from its all-time high. I still see the losses as corrective in nature.

Focus returns to chart support at $2,307.65 down to $2,300.00. More important support is defined by the May low at $2,281.97. Should this level give way, a more protracted corrective phase becomes more likely.

First resistance is marked by a minor intraday pre-jobs-data high at $2,337.28. The halfway back point of today's range at $ 2,348.40 is a more significant technical level.

One potential bright spot today was news that global ETFs registered inflows in May for the first time in 12 months. I say "potential" because one month does not a trend make.


European and Asian buyers provided the boost, while outflows from North America and other regions were relatively small.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$0.986 (-3.15%)
5-Day Change: -0.573 (-1.88%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver is displaying a bearish outside day and appears poised to register a weekly loss. At the time of this writing, Monday's low at $29.413 was being challenged, but was intact.


A new low for the week would further erode the short-term technical picture, shifting focus to a retracement level at $29.214 (50% retracement of the rally from $26.049 to the $32.379 high). The 61.8% retracement level comes in at $28.467. Losses since the 21-May 11-year high are just over 9%.

The halfway back point of today's range thus far is $30.469 which corresponds closely with a minor intraday chart point. A minor intervening barrier is noted at $29.710.

It's been a wild roller coaster ride in the white metal this week. Such is the nature of the silver market. Nonetheless, I continue to see the underlying trend as bullish.

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Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, June 6, 2024 11:50:29 AM America/Chicago

6/06/2024

The rate-cut cycle accelerates with easing moves by the BoC and ECB this week

OUTSIDE MARKET DEVELOPMENTS
: The much anticipated rate-cut cycle appears to be well and truly underway after the Bank of Canada eased on Wednesday and the ECB cut their refi rate by 25 bps today. Both moves were widely anticipated.

The Swiss National Bank cut back in March and may ease further when they meet later this month. The central banks of Sweden, Czech Republic, and Hungary have also cut rates recently. The BoJ on the other hand hiked rates in March for the first time in 17 years amid low inflation, after more than 13 years at or below 0%.

The market is still desperate for clues as to when the Fed will make its first cut. Yesterday's Services ISM print was better than expected, offsetting some of the growth worries raised by the Manufacturing ISM miss earlier in the week.

U.S. yields and the dollar firmed in reaction as hopes for a 'sooner rather than later' move by the Fed ebbed.

Focus remains squarely on May jobs data, which will be released tomorrow. Median expectations are for a payrolls gain of 195k. However, the ADP survey miss and the rise in initial jobless claims to a 4-week high have some concerned that payrolls will undershoot.

GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +6.19
 (+0.26%)
5-Day Change: +21.40 (+0.91%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34


Gold rallied to new highs for the week and then proceeded to take out nearby resistance at $2,361.54/81. The market seemed to be encouraged by the BoC and ECB rate cuts, although both were very much anticipated. Gains may be attributable to position squaring ahead of Friday's jobs report.



Fed funds futures are little changed, still showing November as the most likely timing of the Fed's first rate cut. The market will hope for a clearer picture to emerge after the payrolls data is out.

The next resistance to watch $2,382.41/2,383.24, marked by the halfway back point of the correction off the all-time high and the high from 23-May. While a degree of confidence has been returned to the underlying uptrend, I /don't envision $2,383.24 being taken out ahead of payrolls.

The highs from earlier in the week along with today's overseas low at $2,355.01 now mark initial support. Let's call support $2,355.01/$2351.75. A retreat below this area would suggest potential for further attacks on the downside, putting Monday's low at $2,315.47 back in play.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.289 (+0.96%)
5-Day Change: -0.585 (-1.88%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver surged to new highs for the week early in the U.S. session. The white metal is currently trading nearly 4% higher on the day.



The market seems disinclined to be short going into the jobs report. Analysts seem to be leaning toward a payrolls miss tomorrow.

The rebound above $31 is indeed encouraging, as noted in previous commentary this week. Additionally, just over 61.8% of the 1-week decline from $32.254 (29-May high) has now been retraced.

This is a good indication that the recent corrective phase may be over, but I'm inclined to wait for some confirmation from tomorrow's price action.

Previous resistance at $30.733/825 now defines initial support.

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Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, June 5, 2024 10:27:36 AM America/Chicago

6/05/2024

The metals await additional data for Fed rate cut timing cues

OUTSIDE MARKET DEVELOPMENTS
: The market is expecting a print of +175k for this morning's ADP survey number, and will hope to glean some insight into Friday's payrolls report. JOLTS job openings fell in April to the lowest level since February 2021. Signs of weakness in the labor market would likely pull forward Fed rate cut expectations.

Traders will also be watching Services ISM and PMI to see if the weakness revealed in the manufacturing sector earlier in the week is also evident in the services sector. The ISM prices component is expected to moderate somewhat.

Additional signs of a slowing economy and cracks in the heretofore resilient labor market would ramp the likelihood of a Fed rate cut, but the prospects of anything happening at the June 12 FOMC meeting remain remote. While the timing of that first cut is data-dependent, Fed funds futures currently indicate the Fed won't start easing until November.

The Bank of Canada is expected to cut rates by 25 bps today. The ECB is likely to follow suit tomorrow.

With the first Fed rate cut still thought to be some ways down the road, widening interest rate differentials should provide some underpinning for the dollar. The dollar index hit a near-two-month low on Monday before rebounding modestly.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: 
+$6.78 (+0.29%)
5-Day Change: -$3.98 (-0.77%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold is higher in early U.S. trading on Wednesday with price action confined to the previous day's range. The weakness seen on Tuesday was successfully contained by Monday's low at $2,315.47.



The secondary tier of support is $2,307.65 down to $2,300.00, which is likely to keep the May low at $2,281.97 at bay. While the underlying trend in gold remains decidedly bullish if $2,281.97 gives way, a more protracted corrective phase would be indicated.

Consolidative trading may prevail until Friday's nonfarm payrolls report. The market is expecting a payrolls increase of 195k and the unemployment rate to hold steady at 3.9%.

Deviations from market expectations could set at least the near-term tone for gold. A beat would likely weigh on the yellow metal as the rate cut likelihood would remain in the Nov-Dec timeframe. A significant miss on the other hand would pull rate-cut expectations closer to the present, perhaps even July.

On the upside, chart resistance at $2,361.54/81 is needed to return confidence to the longer-term uptrend. Intervening chart resistance has developed at $2,352.32/$2,357.11.

SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.102 (+0.35%)
5-Day Change: -$2.348 (-7.35%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver tumbled to a 3-week low of $29.413 on Tuesday. Price action today has thus far been confined to the low end of yesterday's range.



The short-term oversold condition may be a limiting factor on the downside ahead of Friday's jobs data, but the technical bias remains to the downside. Penetration of $29.413 would clear the way for additional losses to a retracement level support at $29.214.

The fundamentals for silver remain broadly supportive. The push to more-than-11-year highs above $30 several weeks ago was a significant technical event as well.

Chinese silver imports may surge in the coming weeks due to a significant premium being paid in Shanghai to satisfy strong industrial demand. “A wave of imports into China is going to drain the free float away from the West even further,” said Daniel Ghali, senior commodity strategist at TD Securities Inc. in a recent mining.com article.

Silver needs to reclaim the $30-handle to ease short-term pressure on the downside. However, $31 is the more important level to watch with respect to returning credence to the underlying uptrend. The highs from earlier this week at $30.733/825 now define a solid intervening chart barrier. 

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Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, June 4, 2024 11:30:27 AM America/Chicago

6/04/2024

A significant slowdown in PBoC gold buying in April weighs  

OUTSIDE MARKET DEVELOPMENTS
: Today's U.S. calendar features April factory orders. Median expectations are for a 0.6% rise, down slightly from a revised +0.7% in March. The market has already displayed some concern about growth risks in light of recent data, so a miss on factory orders could further reinvigorate rate-cut bets.

For now, those growth risks are pressuring stocks and yields.

The ECB may cut rates as soon as this week's meeting (June 6). ECB President LaGarde has signaled a "strong likelihood" of a 25 bps cut. The ECB's Stournaras said early last month that the central bank now sees "three interest rate cuts in 2024 as the most likely scenario."

Analysts at Heraeus speculate that a weaker euro could spark European investment in gold as a devaluation hedge. European outflows from gold ETFs have been pretty consistent this year. It would be encouraging to see that trend reversed.

News that the PBoC added less than 2 tonnes of gold to reserves in April is weighing on the yellow metal. Aside from that, The World Gold Council's latest report was largely upbeat, showing an eleventh consecutive month of net purchases and a rebound from March.

Image

Oil and copper losses may be weighing on the broader commodities complex amid demand worries. At the same time, a drop in oil prices just as the summer driving season begins reduces inflation pressures and bodes well for the Fed rate cut scenario.

The market will be paying close attention to the jobs data on Friday to see if the labor market remains resilient.

GOLD
OVERNIGHT CHANGE THROUGH 6:00 AM CDT: 
-$21.56 (-0.917%)
5-Day Change: -33.42 (-1.42%)
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34


Gold formed a simple reversal day on Monday (lower low, higher close), but was unable to sustain the gains. Price action remains confined to yesterday's range (inside day)

Image

Monday's low at $2,315.47 has not been challenged, leaving the more important $2,307.65/$2,300.00 zone protected. While the short-term corrective tone remains bearish, I don't believe the May low at $2,281.97 is in jeopardy, at least not before Friday's jobs report. Look for some base-building price action over the next several sessions.

I'd still like to see good chart resistance at $2,361.54/81 exceeded to return a measure of confidence to the underlying uptrend. Yesterday's high at $2,351.75 along with last Friday's high at $2,357.11 now provide intervening barriers.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: -$1.01 (-3.29%)
5-Day Change: -$2.365 (-7.37%)
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver tumbled in overnight trading, retracing all of Monday's rebound and setting a new cycle low at $29.699. These were the first trades below $30 in more than 2-weeks.

Image

Short-term focus remains squarely on the downside, with the next level of support at $29.214, which is marked by the halfway back point of the leg-up from $26.049 (May 2 low) to the recent cycle high at $32.379 (May 21 high).

I'd like to see silver trade convincingly back above $31 to return some confidence to the uptrend. Suddenly that level is quite a ways away with the overseas high at $30.825 marking intervening resistance.

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Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
312-549-9986 Direct/Text
[email protected]
www.ZanerPreciousMetals.com
www.TornadoBullion.com
X: @GrantOnGold
X: @ZanerMetals
Facebook: @ZanerPreciousMetals

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, June 3, 2024 2:44:03 PM America/Chicago

6/03/2024

Weaker U.S. manufacturing data revives hopes for a Fed rate cut this year

OUTSIDE MARKET DEVELOPMENTS
: U.S. manufacturing ISM and construction spending missed expectations this morning. Interest rates and the dollar tumbled in reaction, providing some supportive buying in the precious metals.

These indications of a slowing U.S. economy revived expectations that the Fed may still cut rates this year. Last week we saw the Fed's preferred measure of inflation holding steady at 2.7% y/y, which lends additional credence to the rate cut scenario. 

However, recent FedSpeak has leaned more hawkish. Even today, Minneapolis Fed President Kashkari said the central bank is on hold for an "extended period."

Last week's Personal Income report for April came in largely as expected, with the Fed's preferred measure of inflation holding steady at 2.7% y/y 

Manufacturing news out of China was more encouraging. The Caixin PMI reading for May came in at 51.7, indicating China's manufacturing sector grew at its fastest pace in two years.

Focus later this week will be on Wednesday's U.S. services PMI and ISM, as well as Friday's nonfarm payrolls report. Median expectations are for an increase of 195k jobs in May. The jobless rate is expected to hold steady at 3.9%.

GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: 
-$3.83
YTD Range: $1,986.16 - $2,449.34
52-Week Range: $1,812.39 - $2,449.34

Gold ended May with a gain of 1.8%, despite the retreat from the $2,449.34 record high set on May 20. It was the fourth consecutive monthly gain. Through the end of May, the yellow metal is up 14.3% YTD.

Image

While the near-term tone is corrective as the first trading week of June commences, the underlying trend remains bullish. While the yellow metal completed a 61.8% retracement of the latest leg-up in the rally in overseas trading today, the extent of the correction off the all-time high has been just 5.5% thus far. 

There's decent chart support at $2,307.65 down to $2,300.00. Today's intraday low at $2,315.47 now marks a good intervening barrier. At this point, I consider more important support marked by the May low at $2,281.97 to be well protected.

A higher close today, above $2,327.82 would be encouraging. A trade above Friday's high at $2,357.11 and a higher close would be better yet for the bulls. A rise above good chart resistance at $2,361.54/81 would return additional confidence to the underlying uptrend.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CDT: +$0.019
YTD Range: $21.945 - $32.379
52-Week Range: $20.704 - $32.379

Silver posted a solid 15.7% gain in May, its third consecutive higher monthly close. That's pretty impressive, given that silver ended the month nearly $2 off the more-than 10-year high that was set on May 21 at $32.379.

While important chart support at $30.077/079 was violated in overseas trading, downside follow-through was minimal. The sell-off in the dollar following data misses helped push the white metal back into positive territory for the day. As of this writing, silver is up more than 50¢ above the $29.908 intraday low.

A convincing push back above $31.00/08 is needed to return confidence to the underlying bullish trend. Until then, the short-term bias remains to the downisde. 

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Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
Tornado Precious Metals Solutions by Zaner
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Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, May 31, 2024 8:19:32 AM America/Chicago

While there was continued divergence between gold and silver yesterday, gold was able to hold its ground in positive territory and finished Thursday with a mild gain.

 

In contrast, silver was the weaker market as it closed with a heavy loss. The declines in silver were outsized and were likely the result of profit-taking by aggressive Asian buyers over the prior two weeks.

 

It should be noted that Chinese silver prices reached a significant premium to spot prices recently resulting in Chinese buying international silver and reducing their risk to the weakness in their currency...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, May 30, 2024 7:57:21 AM America/Chicago

With the dollar overnight breaking out to the highest level since May 14th, US treasury yields nearing the highest levels of the month and critical US inflation data from the quarterly PCE report to be released tomorrow, traders should expect an expansion of volatility in gold.

 

Divergence between gold and silver extended yesterday with silver remaining strong, gold showing weak, and silver adding to its recent show of sector leadership.

 

However, we suspect strength in the dollar and rising global interest rates undermined sentiment and might have prompted some gold longs to exit ahead of tomorrow's US PCE data...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, May 29, 2024 8:06:33 AM America/Chicago

We expect gold and silver to continue to chop roughly in line with yesterday's price action until the first of two significant US inflation reports is released tomorrow.

 

However, bullish fundamental information justifies silver's recent relative strength versus gold as reports of heavy Chinese buying of international silver (because domestic prices are significantly higher) suggest a major demand source has emerged.

 

The bullish theme behind significant Chinese interest is the surging demand for silver in solar energy applications. Along those lines Shanghai spot silver prices last week were 2% above the 13% Chinese import tax or 15% above international silver prices...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, May 28, 2024 8:22:05 AM America/Chicago

While gold and silver are tracking higher early today the charts still favor the bear camp from last week's sharp range-down failures which in turn should make the Thursday/Friday lows key pivot point pricing to start the new trading week.

 

Key pivot point pricing in June gold begins at $2328.10 and at $30.265 in July silver.

 

Adding to the negative track in gold and silver prices early today is news that Chinese April net gold imports plunged 38% from March which we think was largely the result of historically high pricing...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, May 24, 2024 8:30:04 AM America/Chicago

What goes up aggressively and makes a chain of new record highs holds the prospect of aggressive corrective action. In fact, if gold finishes the week at current levels, it will have dropped the most in a single week since last October!

 

In retrospect, the pendulum shift on US interest rate policy back toward the hawks, combined with a higher high in the dollar and a pulse higher in treasury yields, provides a bearish environment for gold and silver into the end of the week.

 

However, if recent gains were partially the result of flight to quality issues, we suspect some bargain-hunting buying will surface before the close today, but perhaps after additional declines...[MORE]

 

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Posted By Zaner Precious Metals

Gold has plunged more than 4% from Monday's record high at $2449.34. The yellow metal fell $42.57 on Wednesday and is off another $35 today.

 

Gold Chart

Gold Chart 



Silver has tumbled nearly 7% from Tuesday's 11-year high at $32.38!

 

Silver Chart

Silver Chart



Losses are mounting as markets unwind rate cut expectations in the wake of Wednesday's release of the minutes from the last FOMC meeting.



Short-term losses like this can have a significant detrimental impact on bullion dealers, mints, and refiners that hold physical precious metals inventory.



The Tornado Hedging Platform by Zaner allows our clients to protect their inventory against such adverse market movements.



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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, May 23, 2024 9:08:25 AM America/Chicago

While the declines yesterday in gold and silver were blamed on fear of hawkish statements from the last Fed meeting minutes, the declines this morning are the result of a realization of hawkish news from the actual release.

 

Apparently, the Fed had a debate on whether policy was tight enough to bring inflation down as quickly as was hoped for and some policymakers were disappointed in the economic information they have seen since the March meeting.

 

Therefore, a minimal higher high for the move in the US dollar adds to the liquidation bias in markets that were significantly overdone into the recent highs...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, May 22, 2024 8:23:40 AM America/Chicago

While today could be a very critical pivot point for gold from a macroeconomic perspective, (US Fed meeting minutes release, 20-year US treasury bond auction, and existing home sales) it should be noted that internal fundamentals remain generally positive.

 

In fact, gold ETF holdings have now risen for six straight days and silver ETF holdings yesterday jumped by a notable 2.8 million ounces.

 

In a minimal and perhaps temporary negative development, gold saw a forecast overnight from Commerzbank suggesting gold prices will fall back to $2300 in the second half of this year. Countervailing the bearish $2300 price projection by Commerzbank is a forecast from Morgan Stanley of a target of $2760 an ounce...[MORE]

 

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PG Comment: I wouldn't consider a retreat to $2300 bearish. That's just 4.6% below the current price. Now if we go the $2760 first...that's another story.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, May 21, 2024 8:19:41 AM America/Chicago

Volatility has expanded and is likely to stay elevated with gold and silver continuing to march to their own drummer.

 

The dollar and treasuries have held within a narrow range over the prior four trading sessions with a very minimal downtrend bias seen in both markets.

 

It should be noted that gold ETF holdings are beginning to rise consistently, with last week posting an inflow of 230,227 ounces, and with the addition of 135,000 ounces in just the last two sessions...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, May 20, 2024 8:13:31 AM America/Chicago

With an overnight explosion in prices, gold reached a new all-time high while silver posted explosive gains and the highest price since February 2013!

 

With the battle heating up in Gaza, a slight shift in the US Fed policy pendulum in favor of the doves last week, and a strong close last week on rising open interest should leave gold in a position to forge even higher all-time highs.

 

However, the silver market could become the sleeper market as a cheap gold substitute, especially with a surprise upside extension overnight, given silver is significantly cheaper than gold, and with silver still well below all-time high levels above $50 from decades ago...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, May 17, 2024 8:26:57 AM America/Chicago

While the gold and silver markets are showing positive action early today, both markets look to face a small measure of outside market pressure from a tick higher in US treasury yields and a higher high versus Thursday in the US dollar.

 

While the gold and silver trade were lifted off the recent low by a glimmer of hope for a US rate cut earlier this (the best odd of a cut is 51.1% for the September Fed meeting) the impact from the Fed yesterday shifted slightly negative with at least two members indicating borrowing costs need to stay higher for longer!

 

Based on overnight Chinese economic data (particularly retail sales came in softer than expected and house prices fell more than expected), the outlook for the Chinese economy and therefore precious metals and commodities was saved by a very unusual and direct Chinese government support for the Chinese housing market...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, May 16, 2024 8:20:41 AM America/Chicago

While yesterday's sharp gains in gold and silver were partly supported by outside market action (lower treasury yields, a weaker dollar, and renewed US rate cut hopes), we continue to think there are classic flight to quality buyers moving into gold and silver as hedges against a geopolitical or financial market crisis ahead.

 

Even though the prospect of a significant crisis and the potential flight to quality influences from a crisis, gold has displayed significant corrective action in the face of the escalation of the Middle East conflict in the recent past.

 

However, ideas that runaway inflation was behind the recent record run-up in gold and silver prices suffered a significant blow yesterday when the US core CPI reading posted the first softening in six months...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, May 15, 2024 8:45:42 AM America/Chicago

Not only did the Fed's Powell thwart a surge in inflationary fears following yesterday's hotter-than-expected US PPI readings, but he also seems to have rekindled US rate cut hopes!

 

However, the second critical monthly US inflation reading in the form of CPI later this morning will be difficult to discount if it posts hotter than expected readings.

 

Certainly, the gold and silver markets will continue to track and react to the ebb and flow of US rate cut prospects, but with strength in a wide array of physical commodities, a breakdown in the US dollar, steady to lower US interest rates, and the potential for fresh inflation fuel from US and Chinese trade tariffs, it is possible that gold and silver will begin to behave like inflationary hedges...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, May 14, 2024 10:57:46 AM America/Chicago

While international inflation measures might not actually correlate with inflation in the US, the markets overnight were presented with an avalanche of inflation readings registering a range of results from steady to red-hot.

 

In fact, beyond the standard scheduled inflation reports, the markets also saw Japanese and Indian April wholesale price index readings jump at the fastest pace in over a year.

 

However, many central bankers and economists see inflation coming under control throughout the world which in turn makes today's US PPI and tomorrow's US CPI a very critical junction for global inflationary expectations...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, May 13, 2024 8:21:55 AM America/Chicago

Apparently, gold and silver traders have had a change of heart over the weekend as the recent revival of US rate cut hopes have seemingly dissipated overnight perhaps because of the prospect of lingering inflation signals from the US PPI report tomorrow.

 

However, expectations for the report call for a 0.2% gain, which will match the previous month, and in turn that could mean inflation has continued to grow over the last four weeks albeit at a softer rate.

 

In another negative, the gold market continues to see signs of high price adversity in the Indian gold trade...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, May 10, 2024 8:00:45 AM America/Chicago

While we understand the premise, seeing gold and silver explode on the upside from a revival of US rate cut hopes appears to be an overreaction.

 

In fact, outside market impacts from treasuries, currencies, and oil prices this morning are not registering noted action seemingly indicating the metals rallies are occurring in isolation.

 

Sentiment is so bullish that expectations toward US CPI and PPI next week are factoring in a downtick in inflation which in turn translates into higher rate cut expectations...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, May 9, 2024 7:50:59 AM America/Chicago

While we don't expect to see significant gold and silver price reactions to today's US jobs-related data, a higher high in the dollar early on, slightly higher US interest rates, and a series of lower highs and lower lows in gold this week leaves the bear camp with an edge.

 

On the other hand, the trade is expecting a slight increase in continuing and initial jobless claims and that could provide a brief lift for prices.

 

However, favorable Chinese trade data and a report of an improvement in the Chinese homebuyer market should boost expectations for better Chinese gold demand...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, May 8, 2024 7:55:37 AM America/Chicago

With the US dollar posting a four-day high overnight and the bias shifting slightly back toward a hawkish vibe (following Minneapolis Fed Pres. comments suggesting the Fed might be on hold through the end of the year) the bias in gold and silver is down to start today.

 

Furthermore, the gold market remains under residual pressure from news yesterday that PBOC gold buying last month slowed perhaps because of the unending record price run.

 

However, the Peoples Bank of China extended its record of 18 straight monthly additions to reserves with a very minimal purchase of 60,000 ounces which is down 100,000 ounces from March and a very explosive 390,000 ounces below February...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, May 7, 2024 8:15:57 AM America/Chicago

While the #gold market forged a quasi-upside breakout yesterday the market has fallen back into a building consolidation zone largely situated between $2352 and $2285.

 

In general, we suspect gold and #silver will continue to benefit from geopolitical flight to quality buying (especially with the Israelis launching their attack on the southern city of Rafah) and somewhat less from the dovish pivot in sentiment toward US interest rates following last week's data.

 

However, the bull camp should be very discouraged with the lack of gains in gold and silver this morning given the Israeli offensive...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, May 6, 2024 7:59:28 AM America/Chicago

With relative calm in the Middle East apparently poised to end soon with an Israeli attack on the southern Gaza city of Rafah, it is not surprising to see gold and silver leap higher to start the new week.

 

While overnight news coverage of the markets suggests gold is rising off US rate cut hopes for later this year, we suspect rate cut hopes are a minimal portion of the fuel for this morning's gains.

 

Classic demand signals were present overnight with the Perth mint April gold sales doubled from March sales while silver sales declined to their lowest level since December...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, May 3, 2024 7:59:40 AM America/Chicago

With a downside breakout in the dollar index overnight to the lowest level since April 12th, a portion of the bear camp should be discouraged.

 

However, gold has clearly established a pattern of lower highs and remains within the lower quarter of the range of the last 30 days in a fashion that favors the bear camp.

 

Furthermore, gold ETF holdings yesterday declined by a VERY significant 193,328 ounces for a 0.2% daily decline, with silver ETF holdings declining by 4.3 million ounces in the last two days...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, May 2, 2024 8:06:27 AM America/Chicago

With the gold and silver markets spiking higher following the Fed policy decision and press conference, the bulls showed some control as the trade was able to discount disappointment over another delay in cutting rates and instead embraced relief that the Fed was not in a mode to consider rate hikes!

However, given a significant jump in ISM Manufacturing prices-paid earlier this week that should be seen as a sign that inflation lives on in various sectors of the economy.

Unfortunately for the bull camp, we think that "dovish spin" will have a short shelf life, especially if today's US unit labor costs report matches expectations of a gain of 3.2% compared to last month's gain of 0.4%...[MORE]

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, May 1, 2024 8:03:06 AM America/Chicago

The deck is stacked against the bull camps in gold and silver today, with an upside breakout in the dollar, signs of higher treasury yields, fear of a hawkish Federal Reserve statement, and a lack of support from Chinese and European buyers overnight due to the May Day holiday.

 

However, the gold market should derive some underpin from World Gold Council projections of continued brisk global central bank purchases, and signs of positive gold demand from India and China.

 

It should also be noted that Indian gold demand increased by 8% during the January through March timeframe with gold jewelry demand in India increasing by 4% and amounting to a significant percentage of total world gold demand...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, April 30, 2024 1:34:23 PM America/Chicago

While oil prices are not signaling an imminent cease-fire deal (given initial gains), sharp declines in gold and silver without correlation to outside market influences, suggest the precious metal trade is anticipating a pause in hostilities.
 
 
However, the bull camp is buoyed by the potential for a third straight monthly gain in gold prices and by talk of strong global gold demand.
 
 
According to the World Gold Council's first-quarter Gold Demands Trends report, total global demand increased by 3% versus 2023 and posted the strongest first quarter since 2016...[MORE]
 
 
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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, April 29, 2024 8:22:33 AM America/Chicago

While the net spec and fund long in gold (adjusted for the $30 rally into Friday's high) suggest the market is heavily overbought, we suspect technical signals will take a backseat to classic flight to quality headline news flow.

 

However, with the post-COT report rally, the net spec and fund long in gold is likely the longest in two years, and therefore any sign of a cease-fire between Israel and Hamas could result in a massive correction.

 

Gold positioning in the Commitments of Traders for the week ending April 23rd showed Managed Money traders net bought 3,296 contracts and are now net long 176,157 contracts...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, April 26, 2024 7:45:11 AM America/Chicago

Once again noted strength in gold and silver prices appears to be taking place in a vacuum, with little change in US interest rates, the dollar, and energy prices overnight.

 

However, the bull camp is likely benefiting from a surprise jump in Chinese first-quarter gold consumption which increased by 5.9% from year-ago levels.

 

Apparently, mainland China's March gold imports through Hong Kong increased by 40% from February giving credence to news earlier this month that Chinese investors were seeking to hold gold to avoid weakness in the domestic currency...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, April 25, 2024 8:03:36 AM America/Chicago

With the gold market over the last 72 hours settling within a range bound by $2350 and $2300, it is possible that some form of value has been found ahead of what is likely to be a key fork in the road for prices.

 

Fortunately for the bull camp, the dollar is showing signs of tracking lower this morning as the aggressive liquidation this week has clearly rocked the bull camp back on its heels.

 

While the February to April rallies in gold and silver were not fueled by definitive inflows to ETF holdings, both gold and silver holdings continue to decline in a sign that small investors have not been enticed by the second half of April setback...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, April 24, 2024 8:09:28 AM America/Chicago

In retrospect, the gold trade was unsure of the primary source of the massive April upside extension of the historic gold rally which began early last October.

 

While the trade remains vulnerable to additional stop-loss selling today from very large net spec and fund positioning, further extraction of war premium is also expected with the gold futures and options positioning (adjusted into the recent highs) likely at three year highs!

 

However, Bloomberg overnight carried a story suggesting a large portion of the gold rally was sparked by aggressive buying at the Shanghai futures exchange...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, April 23, 2024 8:24:58 AM America/Chicago

The capitulation in gold and silver extended overnight with what we think is mostly stop-loss selling from the massive net long built up from the $425 gold rally off the February low and the $7.50 rally in July silver.

 

However, ongoing liquidation of flight to quality longs from lower ME angst is certainly adding to the washout while typical outside market influences of the dollar and treasury yields have not been a noted influence and are unlikely to be a key impact today.

 

In retrospect, there was apparently more flight to quality longs in off the potential for a widespread Middle East war than expected and that should be remembered if conflict returns...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, April 22, 2024 7:49:49 AM America/Chicago

The vibe in the Middle East seems to suggest that the "tit-for-tat" fighting between Israel and Iran will pause has obviously punctured bullish sentiment in gold and silver. Therefore, the focus of gold and silver is likely to shift back to action in the dollar and US treasury yields.

 

While silver ETF holdings continue to decline very rapidly, gold ETF holdings declines are less significant. Last week gold ETF holdings declined by 478,713 ounces, while silver ETF holdings declined by 22.8 million!

 

Even though we suspect the Chinese central bank will continue to add to reserves (following 17 straight months of purchases) we suspect lower prices will have only a marginal impact on the size of Chinese Central Bank purchases...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, April 19, 2024 7:46:33 AM America/Chicago

The big question for the gold trade now is will the tensions between Israel and Iran cool and temporarily end the potential for sudden massive geopolitical-inspired flight to quality buying?

 

While not a major bearish development gold and silver ETF holdings continue to decline with the declines in gold and silver ETF holdings very significant yesterday (Gold -218,995 ounces & Silver -6.3 ml ounces).

 

Even the technical picture has shifted in favor of the bear camp with the overnight spike-up move squarely rejected...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, April 18, 2024 8:08:42 AM America/Chicago

Despite a chorus of hawkish (less dovish) global central bank dialogue flowing from the IMF meeting, gold and silver prices are tracking higher perhaps because of slightly supportive outside market action in US treasuries and the dollar.

 

However, a new concern may be rising in the marketplace as significant declines in Japanese and South Korean currencies were acknowledged by the US Treasury Secretary at the IMF meeting with the US, Japan, and South Korean officials agreeing on the need to monitor and consult with other central banks on the situation.

 

Not surprisingly, the IMF dialogue has resulted in a downside extension in the US dollar this morning which could be the primary source of the gold and silver rebounds.

 

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Posted By Zaner Precious Metals

SILVER INDUSTRIAL DEMAND ROSE 11 PERCENT TO POST A NEW RECORD IN 2023

Wednesday, April 17, 2024 3:51:45 PM America/Chicago

(New York City – April 17, 2024) On the heels of 2022’s record use of silver in industrial applications, a new record high was set in 2023 at 654.4 million ounces (Moz). Ongoing structural gains from green economy applications underpinned these advances as they did in 2022. Higher than expected photovoltaic (PV) capacity additions and faster adoption of new-generation solar cells raised global electrical & electronics demand by a substantial 20 percent. At the same time, other green-related applications, including power grid construction and automotive electrification, also contributed to the gains.

 

Overall, silver demand exceeded silver supply in 2023 for the third consecutive year, resulting in a structural market deficit of 184.3 Moz...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, April 17, 2024 3:46:04 PM America/Chicago

The bias in gold remains up despite negative divergence with silver prices and news of continued outflows from gold and silver ETF holdings.

 

However, yesterday gold impressively managed gains despite another significant extension of upside action in the dollar and in the face of another higher high in US treasury yields.

 

There are some discussions in the marketplace that some form of crisis is ahead because of the unrelenting gold market gains and the only other major market reaction to a looming global flight to quality event is the surging US dollar...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, April 16, 2024 8:12:28 AM America/Chicago

While the dollar has retrenched from a fresh spike up new high for the move this morning, the bias in the dollar remains up to start today.

 

However, soft US housing data could provide a brief respite from the strong dollar for gold and silver longs this morning.

 

Unfortunately for the bull camp gold and silver ETF holdings continue to decline highlighting a lack of small investor interest in one niche of the metal markets.

 

On the other hand, Citi has doubled down on its bullish gold price forecast projecting gold to reach $3000 in the next 6 to 18 months...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, April 15, 2024 8:27:12 AM America/Chicago

In addition to the major swing higher at the end of last week exaggerating the overbought conditions of gold and silver, the trade will likely have to contend with a surging US dollar, which is nearing the highest level in 5 1/2 months.

 

Fortunately for the bull camp, US interest rates fell back slightly on Friday with traders thinking the upward track in interest rates will now abate.

 

However, the Iranian drone attack directly against Israel is clearly an expansion of the fighting and could mean a country fighting a country instead of a country fighting a terrorist group...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, April 12, 2024 7:36:29 AM America/Chicago

With gold and silver prices significantly higher overnight in the face of a very significant upward thrust in the US dollar, it is possible the markets are beginning to aggressively embrace flight to quality buying from rising economic concerns toward China.

 

In fact, overnight Chinese import, and export readings came in significantly below expectations which facilitates more anxiety toward an economy thought to have serious problems.

 

It is also likely that rising concerns of financial pressures on developing countries are fostering flight to quality buying of gold and silver in anticipation of a financial crisis in the emerging market sector...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, April 10, 2024 8:02:00 AM America/Chicago

While gold has not managed a new all-time high this morning, both gold and silver markets remain just under this week's highs.

 

We suspect the downgrade of China provides a measure of flight to quality buying. However, China is also the largest consumer of gold, and the last mainland China gold import tally showed a month-over-month reduction of almost 50% and therefore the downgrade could injure classic physical gold demand expectations.

 

In a sign of volatility potential in the current market, the Shanghai Futures Exchange implemented trading limits on gold and copper starting Friday...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, April 9, 2024 8:16:26 AM America/Chicago

The overnight action is a good example of how the gold and silver trade is tracking its own course, as interest rates, currency, bitcoin, and energy prices are not giving off notable influences and yet gold and silver prices have surged again with gold posting another new all-time high.

 

Therefore, it is unlikely gold is tracking a classic safe harbor issue with a broad global origin.

 

In a slightly negative signal, both gold and silver ETF holdings declined yesterday, with the gold extraction of 299,047 ounces the largest single-day exodus in three months...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, April 8, 2024 8:11:46 AM America/Chicago

While the gold and silver markets exhibited significant two-sided volatility at the end of last week, the bull trend has clearly prevailed and is managing that action despite adversity from the dollar and interest rates.

 

However, a small portion of the upside impetus is likely the failed Middle East peace talks undertaken by Egypt.

 

It appears that gold and silver ETF holdings have started to climb with the flat price of gold in a potential beginning of the end of the rally...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, April 5, 2024 10:30:57 AM America/Chicago

Clearly, gold and silver prices lost upside momentum in the wake of a very active US economic report slate this week that has presented a mixed outlook for the US economy and surprisingly failed to markedly increase expectations for a US June rate cut.

 

Certainly, the markets have been disappointed by Fed dialogue seemingly playing down and or pushing back the prospect of rate cuts!

 

However, the gold and silver trade will likely remain sensitive and perhaps poised to rally if today's key nonfarm payroll reading is softer and the takeaway from US data shifts sentiment toward economic risk...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, April 4, 2024 7:49:40 AM America/Chicago

With a downside extension in the dollar, another new all-time high in June gold was to be expected this morning.

 

Apparently, the latest surge was ignited by a bullish interpretation of Fed commentary yesterday reiterating the likely prospects of rate cuts "this year". Surprisingly, the Fed's vagueness on timing for a cut and even less guidance on the number of potential cuts has not deterred gold buyers or dollar sellers.

 

Seeing gold ETF holdings rise by 78,610 ounces yesterday and silver ETF holdings jumping by 2.8 million ounces, the record run in gold appears to have finally gotten the attention of small investors...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, April 3, 2024 8:31:40 AM America/Chicago

Another day and another new all-time high in gold prices with the market managing the rally in the face of adversity from the dollar and US treasury yields.

 

According to overnight press coverage from Asia, gold prices are being lifted by inflationary pressures resulting in the purchasing of gold as a hedge.

 

However, we are suspicious of that argument as inflation data has softened and delays in cutting interest rates should reduce inflationary expectations...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, April 2, 2024 8:59:34 AM America/Chicago

The record run in gold prices continues and has pulled silver prices up seemingly against headwinds.

 

Utilizing typical market interactions, the gold run seems to be unfolding in a virtual vacuum. In fact, the gains in gold and silver prices yesterday took place in the face of heavy headwinds from a strong dollar and rising US interest rates.

 

While the reduced probability of three rate cuts may create economic uncertainty and a measure of anxiety, thereby providing flight to quality interest in gold, that theory is squashed by the lack of anxiety in equities and the lack of upside action in Bitcoin...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, April 1, 2024 8:06:16 AM America/Chicago

The views that gold prices are being pulled higher by Bitcoin are dealt a blow this morning with gold at times trading nearly $40 an ounce higher and bitcoin at times trading $2000 lower.

 

Another potential myth regarding the record run in gold is talk that global central bankers are dumping the dollar in favor of long gold positions.

 

While we suspect central bankers have investment plans in motion to buy gold, the dollar has not suffered from a massive rotation.

 

On the other hand, hedge fund managers continue to build their long positions...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, March 28, 2024 8:19:21 AM America/Chicago

We are surprised the gold market is tracking in positive ground this morning considering the sharp upside breakout extension in the dollar, slightly higher US treasury yields, and perhaps most importantly in the face of comments from the Fed's Waller indicating he needed at least two more months of favorable inflation data to be comfortable cutting rates.

 

However, Waller's comments do not preclude a June rate cut considering the two-month qualifying statement, with [Friday's] PCE readings for February.

 

This morning the CME Fed watch tool pegs the odds of a June 12th rate cut at only 55.4% compared to 64% yesterday...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, March 27, 2024 8:06:04 AM America/Chicago

Even though June gold has managed to build consolidation low support just under $2200, the dollar charts show residual bullishness which in turn offers overhead resistance for gold and silver.

 

Today's US economic report slate presents minimal news from weekly mortgage applications and a seven-year note auction at midsession.

 

With June gold flaring sharply higher and giving up those gains quickly yesterday, the market has given off another blowoff top signal on the charts. However, the gold market also forged a blowoff top last week and at times yesterday had recovered $42 of the $66 slide...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, March 26, 2024 8:05:32 AM America/Chicago

With a weaker US dollar and an initial higher high for the move in Bitcoin, outside market forces favor the bull camp in gold and silver.

 

Certainly, gold will continue to draft support from the long list of flight-to-quality issues, but signs of an overbought condition in the Indian gold market is concerning.

 

With growing concerns of exploding gold loans, the Reserve Bank of India has instructed the country's largest gold loan non-bank finance company to halt fresh gold loans, and there are reports that Indian buyers are experiencing price shock...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, March 22, 2024 7:33:33 AM America/Chicago

After a strong start to Thursday post-FOMC, precious metals fell back from early highs with gold finishing with a moderate gain while silver had an outside-day lower close and a reversal from a 3 1/2-month high, and both metals have followed through to the downside early in today's action.

 

Going into the weekend and with one holiday-shortened week left in the first quarter, both metals are vulnerable to profit-taking and additional long liquidation today.

 

The FOMC meeting results maintained the Fed's projection of 75 basis points in rate cuts by the end of this year, and that has increased the chances for a June rate cut which in turn provided a boost to the precious metals...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, March 21, 2024 8:29:27 AM America/Chicago

Precious metals have broken out to the upside in a very positive reaction to the FOMC meeting results.

 

June gold has reached a new record high while May silver reached a 3 1/2-month high early in today's action, and both are holding onto those gains this morning.

 

Gold and silver have benefited from the sizable pullback in the dollar after it reached a 3-week high before the FOMC meeting results. While the dollar has found its footing, it remains well below Wednesday's high and is providing support to metals markets...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, March 20, 2024 8:18:50 AM America/Chicago

While gold prices have regained the upper hand on silver, both are holding in relatively tight price ranges this morning.

 

After this afternoon's Fed meeting results and Fed Chair Powell's press conference, gold and silver are likely to break out of those tight ranges.

 

The dollar has rallied to a 3-week high in a "buy the fact" reaction to the first Bank of Japan rate hike in 17 years, and that continues to pressure gold and silver prices...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Metals at the ANA Money Show

Tuesday, March 19, 2024 12:21:47 PM America/Chicago

The Zaner Metals team attended the American Numismatic Association Money Show last week.

Zaner Metals Team

The Broadmoor is a spectacular venue and the crowds didn't seem deterred at all by the snowstorm that began on Wednesday and continued into Thursday.

The Broadmoor entrance

The Upstate Coin & Gold client appreciation dinner at the United States Olympic Museum was amazing!

Adam Packard admiring the Olympic Torch collection


We had many great conversations about hedging precious metals inventory, eCommerce solutions, and inventory management. We hope to continue those conversations in the weeks ahead.

Shout-out to Dane and Adam of Olevian Numismatic Rarities, Tom Hallenbeck of Hallenbeck Coin Gallery, Inc., and all the rest for freely sharing your valuable industry insights. We fully anticipate incorporating some of your ideas into upcoming product releases.

Tom Garland ready to hit the show floorTom Garland with a big gold nugget

It was great to see old friends and make new connections. We look forward to seeing all of you at upcoming shows.

In the meantime, if you have questions about our product offerings or wish to get set up with a demo of the Tornado Hedging Platform, please give us a call at 312-549-9986.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, March 19, 2024 8:23:16 AM America/Chicago

While gold and silver saw divergent trading action at the start of this week, they are both on the defensive early on.

 

There was a role reversal Monday with gold regaining the upper hand on silver as both remain close to 2024 price highs.

 

The dollar has extended its mid-March recovery to a 3-week high in the wake of the Bank of Japan's first rate hike since 2007 as the Yen had a "sell the fact" reaction falling to a new low for the move and that in turn put early pressure on precious metals prices...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, March 18, 2024 7:53:12 AM America/Chicago

With several critical central bank meetings this week, gold and silver are finding mild pressure early on.



The precious metals saw mixed results on Friday as gold could not shake off mild early pressure by the close, while silver rallied to a 3½-month high.



A mixed tone in recent US economic data has led to uncertainty over the Fed's rate cut outlook this year...[MORE]


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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, March 15, 2024 8:22:39 AM America/Chicago

With another higher high for the move early today in the dollar and treasury yields hovering just below the three-week highs posted yesterday, the gold and silver trade should continue to feel the looming threat of liquidation.

 

On the one hand, gold and silver prices deserved a measure of corrective weakness after such massive gains over the last two months.

 

However, the corrective action in gold and gold-related instruments was broad yesterday with gold mining shares giving back recent noted gains...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, March 14, 2024 9:46:48 AM America/Chicago

Even though April gold posted a solid gain in Wednesday's trade, further confirmation of residual/sticky US inflation today could unleash an additional and perhaps more aggressive long liquidation washout.

 

Fortunately for the bull camp, the US dollar has not rallied on stubborn signs of sticky US inflation and declining US rate cut hopes, but that could change if Tuesday's inflation concern is reconfirmed by today's inflation news.

 

It should also be noted that Bitcoin posted new all-time highs again and, most gold mining shares showed significant gains yesterday with Newmont and Barrick up 1.7%, Harmony gold up 3.6% and Sibanye Stillwater up 6.7%...[MORE]

 

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Posted By Zaner Precious Metals

Gold weighed by hotter than expected PPI

Thursday, March 14, 2024 8:38:10 AM America/Chicago

U.S. PPI +0.6% in Feb, above expectations of +0.3%, vs +0.3% in Jan; 1.6% y/y, vs upward revised 1.0% in Jan.

 
Core +0.3%, above expectations of +0.2%, vs +0.5% in Jan; 2.0% y/y, steady vs Jan.

 
Gold is weaker as June rate hike prospects are further tempered.
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, March 13, 2024 10:15:56 AM America/Chicago

While the dollar has not shown fresh direction following its aggressive recovery bounce yesterday, the upward bias from the charts and a measure of newfound respect for lingering inflation reduces the prospect of US easing in June.

 

However, gold and silver should be cushioned by continued chatter about a European rate cut in June.

 

In today's action, the markets could simply "mark time" as the other shoe to drop (Thursday's PPI) could easily rekindle another upward pulse in the dollar and downward pulse action in gold and silver...[MORE]

 

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Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, March 12, 2024 8:11:17 AM America/Chicago

There is no doubt the gold market has expended a tremendous amount of speculative buying fuel in achieving a $200 rally and today the trade will finally see the true origin of the rally.

 

In our opinion, part of the significant rally in gold is the market's attempt to mirror the record rally in Bitcoin, with a lesser force from hopes of a June rate cut.

 

Clearly, traders are becoming price-sensitive as Friday's massive range-up move has stalled and trading volume has moderated significantly...[MORE]

 

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Posted By Zaner Precious Metals

Gold pulls back from record high ahead of US CPI data

Tuesday, March 12, 2024 7:57:16 AM America/Chicago

March 12 (Reuters) - Gold edged further away from a record peak on Tuesday as it looks set to break nine straight sessions of gains ahead of critical U.S. inflation data that could pave the way for imminent interest rate cuts by the Federal Reserve.
 
 
Spot gold fell 0.5% to $2,171.59 per ounce as of 1207 GMT, trading below a record high of $2,194.99 it hit on Friday. U.S. gold futures also dipped 0.5% to $2,177.50...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, March 11, 2024 8:07:40 AM America/Chicago

With outside market action remaining in favor of the bear camp early today, the bull camp remains hopeful that this week's inflation data will further revive the prospect of a US rate cut, which in turn would continue to pressure the dollar and treasury yields lower.

 

However, the gold market is vulnerable this morning following comments from the Indian Bullion and Jewelers Association suggesting Indian wedding season demand will soften due to record pricing.

 

Along those lines, the domestic Indian gold trade has seen prices shift into a discount relative to global markets, with Chinese premiums narrowing...[MORE]

 

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Posted By Zaner Precious Metals

Gold steady after record run as US inflation data looms

Monday, March 11, 2024 7:47:48 AM America/Chicago

March 11 (Reuters) - Gold prices held steady on Monday after hitting a series of record highs last week, while investors waited for U.S. inflation data for insights into the Federal Reserve's rate cut timeline.
 
 
Spot gold was little changed at $2,176.30 per ounce at 1121 GMT, after hitting a record high for the fourth consecutive session on Friday at $2,194.99 as data indicated the U.S. labour market was slowing...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, March 8, 2024 11:03:53 AM America/Chicago

Higher all-time highs overnight are clearly justified by ongoing outside market assistance.

 

In addition to a multiweek low in US treasury yields, the gold and silver bulls were presented with a downside extension in the dollar to the lowest levels since the middle of January!

 

In retrospect, outside market forces for gold this week became entrenched in favor of the bull camp with a distinct pattern of US slowing evidence, a slightly dovish US Fed takeaway, and increased expectations for a June rate cut from the ECB...[MORE]

 

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Posted By Zaner Precious Metals

Gold hits fresh record, heads for best week in 5 months

Friday, March 8, 2024 7:45:41 AM America/Chicago

March 8 (Reuters) - Gold prices hit record highs for a fourth consecutive session on Friday on growing speculations over June interest rate cuts ahead of key U.S. jobs data due later in the day.
 
 
Spot gold rose 0.3% to $2,165.1 per ounce as of 1300 GMT, while U.S. gold futures added 0.3% to $2,172.40...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, March 7, 2024 8:30:03 AM America/Chicago

While the views might be misguided and premature, a segment of the market believes interest rate cuts are likely to rekindle inflation which could be the source of the recent buying frenzy in gold, silver, and Bitcoin.

 

Another bullish catalyst for gold and other physical commodities came from strong Chinese commodity imports which provides hope the Chinese economy is recovering. Keep in mind, the Chinese are the world's largest gold consumers!

 

However, April gold has continued to surge over the last 48 hours while Bitcoin has seemingly stalled questioning the correlation between the two markets...[MORE]

 

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Posted By Zaner Precious Metals

Gold extends record run as Fed's Powell hints at rate cuts

Thursday, March 7, 2024 8:08:17 AM America/Chicago

March 7 (Reuters) - Gold prices extended gains to hit an all-time high on Thursday after comments from U.S. Federal Reserve Chair Jerome Powell fostered expectations for lower U.S. interest rates this year.
 
 
Gold tends to thrive when interest rates are low, which reduce the opportunity cost of holding non-yielding bullion...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, March 6, 2024 8:33:03 AM America/Chicago

Obviously, gold and silver are short-term overbought from a technical perspective and perhaps somewhat overbought from a fundamental perspective.

 

Nonetheless, with gold and silver prices vaulting higher yesterday and gold prices forging record highs again, the bull camp retains control even without a definitively apparent bullish fundamental theme.

 

However, gold has forged a five-day low-to-high rally of $123 which suggests the bull camp will need some "help" from the US Federal Reserve Chairman's testimony this morning...[MORE]

 

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Posted By Zaner Precious Metals

Gold holds near all-time-high levels ahead of Fed testimony

Wednesday, March 6, 2024 8:11:25 AM America/Chicago

March 6 (Reuters) - Gold prices gained on Wednesday to trade near previous session's record highs as markets expect Federal Reserve Chair Jerome Powell's testimony later in the day to reveal clues on a potential June rate cut.
 
 
Spot gold was gained 0.3% to $2,132.80 per ounce, as of 1249 GMT after hitting a historic high of $2,141.59 per ounce in the prior session. U.S. gold futures were steady at $2,141.60...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, March 5, 2024 8:20:56 AM America/Chicago

With both gold and silver posting higher highs overnight it is clear the bullish track from the prior three trading sessions has remained in place.

 

In fact, given a significant dip in eurozone producer prices of 0.9%, the prospects of an ECB rate cut in June have jumped.

 

Apparently, the gold and silver trade are not unnerved by the disappointing Chinese Caixin services PMI reading, but that could be the result of anticipation of a Chinese stimulus package announcement...[MORE]

 

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Posted By Zaner Precious Metals

Gold hits record high on US rate-cut optimism

Tuesday, March 5, 2024 7:53:27 AM America/Chicago

March 5 (Reuters) - Gold notched a record high on Tuesday, as traders ramped up bets of a start to interest-rate cut by the U.S. Federal Reserve in June, with investors pouring money into the safe-haven asset as the Middle-East war drags on.
 
 
Spot gold climbed 1% to $2,136.69 per ounce by 1332 GMT. U.S. gold futures jumped 0.9% to $2,145.40 per ounce. Gold last hit a record high of $2,135.40 on Dec. 4...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, March 4, 2024 8:30:53 AM America/Chicago

Apparently, expectations for a June US interest rate cut have returned which in turn fueled the most significant gold and silver rallies since early December.

 

However, the CME Fed Watch tool did not show a significant increase in the probability of a June rate cut from just below 50% early last week to only 52.8% after the close Friday.

 

Therefore, the gold and silver markets are anticipating the continuation of soft US and international data which has already resulted in widespread talk of eurozone, Japanese, and Canadian rate cuts in June...[MORE]

 

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Posted By Zaner Precious Metals

Gold hovers near two-month peak as bets build for June US rate cut

Monday, March 4, 2024 7:53:23 AM America/Chicago

March 4 (Reuters) - Gold prices were anchored near a two-month peak on Monday, following last week's tepid U.S. economic data, which solidified bets for the Federal Reserve's first interest rate cut of the year in June.
 
 
Spot gold was steady at $2,082.89 per ounce, as of 1230 GMT. U.S. gold futures fell 0.2% to $2,091.50...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, March 1, 2024 8:12:26 AM America/Chicago

In retrospect, the action in gold and silver this week has been nothing short of stellar given periodic adversity from strength in the dollar.

 

Furthermore, gold managed to shrug off headwinds from signs of slowing in the US and European economies especially with gold at times over the last several weeks seemingly benefiting from "hope" of a recovery in physical/industrial gold demand following a global macroeconomic euphoria wave.

 

Apparently, the gold trade interpreted yesterday's US PCE report result as a sign inflation was slowing which apparently keeps US rate cut hopes alive...[MORE]

 

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Posted By Zaner Precious Metals

Gold poised to extend gains for second week on firming Fed rate-cut bets

Friday, March 1, 2024 7:37:46 AM America/Chicago

March 1 (Reuters) - Gold prices hit a one-month high on Friday and were set for a second straight week of gains as the latest U.S. data pointed to signs of slowing inflation, bolstering investor expectations of an interest rate cut by the Federal Reserve in June.
 
 
Spot gold edged 0.5% higher to $2,053.10 per ounce, as of 1226 GMT, its highest level since Feb. 2. U.S. gold futures firmed 0.4% at $2,063...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, February 29, 2024 8:21:19 AM America/Chicago

Not surprisingly, the markets expected to be impacted by today's critical US inflation reading (PCE) and they have forged tight trading ranges again overnight as many traders avoid implementing fresh positions in front of what could be a critical trend-deciding report in the form of US PCE later today.

 

Fortunately for the bull camp, open interest in gold has come down significantly since the middle of last month, potentially suggesting the market found solid value earlier this month around $2,000.

 

Unfortunately for the bull camp, a US PCE reading above +0.3% will likely relaunch the dollar sharply higher and set the stage for a return to $2,000 in April gold in the coming sessions...[MORE]

 

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Posted By Zaner Precious Metals

Gold treads cautiously as US PCE data takes spotlight

Thursday, February 29, 2024 8:03:59 AM America/Chicago

Feb 29 (Reuters) - Gold remained trapped within a narrow range on Thursday, as investors exercised patience in the run up to a key U.S. inflation number and remarks from Federal Reserve officials to glean clarity on the trajectory of interest rates.
 
 
Spot gold was little changed at $2,030.62 per ounce, as of 1058 GMT, trading in a narrow $7 range in the session so far. U.S. gold futures eased 0.2% at $2,038.80...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, February 28, 2024 8:30:02 AM America/Chicago

With an upside breakout in the US dollar overnight surprisingly forged in the wake of a series of soft US data points over the last 5 sessions, the markets are expecting today's US GDP report to partially right the ship of the US economy.

 

However, it is also possible the dollar is feeding higher off persistent hawkish views from Federal Reserve members which could be expected to reach a fever pitch just before midsession today with the Fed's Bostic, Collins, and Williams speaking just ahead of midsession.

 

Expectations for US GDP call for no revision in a previous growth rate of 3.3%. While not a definitive bullish impact, a Russian gold mining group indicated last year's gold production declined by 6.8% on a base output of 412,500 Troy ounces...[MORE]

 

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Posted By Zaner Precious Metals

Gold hurt by dollar rebound; traders eye key data for Fed rate cut timing

Wednesday, February 28, 2024 8:09:00 AM America/Chicago

Feb 28 (Reuters) - Gold prices edged down for a third straight day on Wednesday, hurt by a rebounding U.S. dollar, ahead of crucial economic data which help shape investors' view on the timing of the Federal Reserve's interest rate cuts.
 
 
Spot gold slipped 0.1% at $2,026.71 per ounce, as of 1049 GMT. U.S. gold futures fell 0.4% to $2,035.90 per ounce...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, February 27, 2024 8:13:40 AM America/Chicago

With a three-day low in the dollar extending a lower high and lower low pattern and US treasuries posting early gains, gold and silver bulls have an edge from outside market action.

 

The dollar was clearly undermined by disappointing US new home sales readings for January yesterday, and we suspect the trade saw some anticipatory selling ahead of what is expected to be a very soft US durable goods report today (expectations -4.5%).

 

While we think softer economic activity will undermine gold and silver prices because of the recent focus on the potential for improved physical demand, it is possible a very disappointing US durable goods report will knock the dollar sharply lower and in turn help gold and silver find firm support...[MORE]

 

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Posted By Zaner Precious Metals

Gold rebounds as US dollar, yields slip with eyes on Fed guidance

Tuesday, February 27, 2024 7:34:30 AM America/Chicago

Feb 27 (Reuters) - Gold prices inched up on Tuesday, buoyed by a weaker U.S. dollar and bond yields, ahead of a key inflation report and comments from Federal Reserve officials for further clues on when interest rate cuts will commence.
 
 
Spot gold was up 0.4% at $2,038.15 per ounce as of 1229 GMT, hovering near its highest since Feb. 7 hit on Friday. U.S. gold futures rose 0.4% to $2,047.30 per ounce...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, February 26, 2024 9:52:43 AM America/Chicago

The action in gold this morning should be concerning to the bull camp as the dollar remains vulnerable on its charts with five straight days of lower highs.


While not a major supportive development, treasury prices have added to last week's late rebound early today.



With a lack of global economic data overnight, generally lower equities, and a veritable avalanche of US scheduled data ahead this week some gold longs might be taking profits and moving to the sidelines temporarily...[MORE]

 

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Posted By Zaner Precious Metals

Gold trips as markets scale back U.S. rate cut bets ahead of key data

Monday, February 26, 2024 9:51:35 AM America/Chicago

Gold slipped on Monday as markets pared back expectations of the Federal Reserve’s easing cycle and cautiously awaited a key inflation reading this week, which is likely to provide an updated view on the timing of interest rate cuts.

 

Spot gold edged down 0.1% to $2,033.89 per ounce as of 1005 GMT, after rising to its highest since Feb. 7 on Friday. U.S. gold futures dropped 0.3% to $2,043.30 per ounce...[LINK]

           
Posted By Zaner Precious Metals

Gold trickles lower as early US rate-cut bets wane

Friday, February 23, 2024 7:35:28 AM America/Chicago

Feb 23 (Reuters) - Gold prices fell on Friday, weighed down by a slight uptick in the dollar after U.S. Federal Reserve policymakers signalled they were in no rush to cut interest rates this year.
 
 
Spot gold was down 0.4% at $2,016.43 per ounce, as of 0951 GMT, but still on track for a small weekly rise. U.S. gold futures edged 0.2% lower at $2,026.10 per ounce...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, February 22, 2024 8:13:24 AM America/Chicago

While the press continues to tout flight to quality buying interest in gold from events in the Middle East, we are highly suspicious of that argument and think the ebb and flow of the dollar index trade is the primary focus of the gold trade.

 

Therefore, with the downside breakout/plunge in the dollar to the lowest level since February 2nd overnight, US treasury yields potentially capping out just below three-month highs, and broad-based risk-on sentiment from good Nvidia earnings the bull camp has several credible themes.

 

While it is possible that gold is deriving some investment support from surging Harmony gold mining shares, the company also predicted their production would increase by 14% and they recorded higher grades of ore than year-ago levels which are limiting gold futures prices...[MORE]

 

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Posted By Zaner Precious Metals

Gold climbs on dollar retreat and conflict-driven demand

Thursday, February 22, 2024 7:59:30 AM America/Chicago

Feb 22 (Reuters) - Gold prices rose on Thursday, driven by a retreating U.S. dollar and safe-haven demand on the back of the Middle East conflict while investors await further U.S. economic data for a steer on interest rate expectations.
 
 
Spot gold gained 0.1% to $2,027.80 an ounce by 1300 GMT, having hit $2,031.99 on Wednesday for its highest since Feb. 9. U.S. gold futures rose 0.2% to $2,038.10...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, February 21, 2024 8:11:50 AM America/Chicago

With a higher high for the move overnight April gold has extended a slight bullish edge into another trading session.

 

Surprisingly April gold managed the higher high despite a measure of strength in the dollar.

 

However, a very minor and indirect negative impact on gold overnight came from a very hot New Zealand producer price index reading which for some keeps fear of global inflation in place.

 

In today's early action traders will be confronted with a US Fed speech, a 20-year US treasury bond auction, and perhaps most importantly the release of the FOMC meeting minutes from the Fed's most recent meeting...[MORE]

 

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Posted By Zaner Precious Metals

Copper, gold to get 'largest immediate' boost from Fed easing, Goldman says

Wednesday, February 21, 2024 7:56:22 AM America/Chicago

Feb 21 (Reuters) - Copper and gold are expected to see the largest immediate price boost in the commodities sector from potential U.S. Federal Reserve interest rate cuts, analysts at Goldman Sachs said.
 
 
"The immediate price boost from a Fed driven 100 basis point decline in U.S. 2-year rates is the largest for metals, especially copper (6%), and then gold (3%), followed by oil (3%)," Goldman Sachs said in a note dated Feb. 20...[LINK]
           
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Posted By Zaner Precious Metals

Gold gains as markets await Fed minutes, Mideast tensions boost appeal

Wednesday, February 21, 2024 7:46:13 AM America/Chicago

Gold prices rose on Wednesday as investors looked to the minutes of the Federal Reserve’s latest policy meeting for cues on timing of interest rate cuts, while safe-haven demand buoyed by escalating conflict in the Middle East also lent support.

 

Spot gold was up 0.2% at $2,027.96 per ounce as of 1012 GMT. Prices had climbed to their highest since Feb. 9 earlier in the session...[LINK]

           
Posted By Zaner Precious Metals

Gold holds ground as focus turns to Fed minutes

Tuesday, February 20, 2024 7:54:53 AM America/Chicago

Gold prices held steady on Tuesday despite a stronger dollar and elevated Treasury yields, as investors awaited the minutes of the last U.S. Federal Reserve policy meeting for more clues on its interest rate cut timing.

 

Spot gold was flat at $2,018.03 per ounce, as of 0341 GMT. Most of the U.S. markets were closed on Monday for the President’s Day holiday...[LINK]

           
Posted By Zaner Precious Metals

Gold at one-week high as soft dollar, Middle East turmoil lift demand

Monday, February 19, 2024 9:46:03 AM America/Chicago

Gold prices rose to a nearly one-week high on Monday as a slight pullback in the U.S. dollar and escalating tensions in the Middle East lifted bullion’s safe-haven appeal.

 

Spot gold was up 0.3% at $2,019.99 per ounce, as of 0530 GMT, hitting its highest since Feb. 13...[LINK]

           
Posted By Zaner Precious Metals

PPI comes in hotter than expected

Friday, February 16, 2024 8:32:20 AM America/Chicago

U.S. PPI +0.3% in Jan, above expectations of +0.1%, vs downward revised -0.2% in Dec; 0.9% y/y, down from 1.0% in Dec.

 

Core +0.5%, above expectations of +0.2%, vs downward revised -0.1% in Dec; 2.0% y/y, vs revised 1.7% in Dec.

 

Gold has softened in reaction but remains confined to yesterday's range.

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, February 16, 2024 8:23:36 AM America/Chicago

With the gold market sitting at levels that would create the first weekly loss of this year, the dollar minimally higher, treasury yields minimally higher and US producer price index report for January scheduled for release this morning, gold is likely to experience a flare of volatility which will likely dissipate quickly.

 

While we see the current fundamental and technical trend pointing down, as expected or softer than expected PPI readings (expectations of +0.1%) could dramatically increase respect for the $2000 level and prompt a short covering wave capable of sending April gold up to $2026.

 

However, the trade will be presented with a second wave of US inflation information in the form of the University of Michigan five-year consumer inflation expectations report for the month of February...[MORE]

 

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Posted By Zaner Precious Metals

Gold heads for second weekly loss as early rate cut bets cool

Friday, February 16, 2024 7:50:06 AM America/Chicago

Feb 16 (Reuters) - Gold held steady on Friday but was on track for a second consecutive weekly fall as traders lowered expectations of rapid U.S. rate cuts, while markets sought more data for further clarity on the Federal Reserve's next move.
 
 
Spot gold rose 0.1% to $2,006.98 per ounce, as of 1248 GMT, and has lost nearly 1% for the week so far. U.S. gold futures gained 0.2% at $2,019.00 per ounce...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, February 15, 2024 7:54:54 AM America/Chicago

While April gold is tracking in positive territory early today and has established a key pivot point around $2005, the onus is on the bull camp to prove the market can respect even number consolidation support at $2000.

 

Unfortunately for the bull camp, gold ETF holdings continue to slide with year-to-date outflows of 2.8% taking place in less than 50 days.

 

While Indian gold imports in January increased to $1.9 billion that is probably a function of the recovery in gold prices and not necessarily from increased volume...[MORE]

 

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Posted By Zaner Precious Metals

Gold near two-month low, investors eye US data for rate cut cues

Thursday, February 15, 2024 7:41:59 AM America/Chicago

Feb 15 (Reuters) - Gold prices languished near a two-month trough on Thursday as traders lowered expectations of sooner and deeper rate cuts by the Federal Reserve this year, while markets await a slew of U.S. economic data for further clarity.
 
 
Spot gold was up 0.3% at $1,997.10 per ounce, as of 1158 GMT, but hovered near its lowest since Dec. 13 hit on Wednesday. U.S. gold futures rose 0.3% to $2,009.20...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, February 14, 2024 10:32:41 AM America/Chicago

While the magnitude of yesterday's US CPI upside surprise was not significant, the markets were clearly undermined by another US data point which appears to push back US rate cut timing.

 

Today the markets will have a pause from US inflation news with several Fed speeches potentially providing some fireworks.

 

However, the US dollar is sitting right on the spike-up highs from yesterday early today leaving the currency influence on gold and silver bearish...[MORE]

 

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Posted By Zaner Precious Metals

Gold hovers below key $2,000 mark as markets tone down rate-cut bets

Wednesday, February 14, 2024 7:37:57 AM America/Chicago

Feb 14 (Reuters) - Gold prices extended declines on Wednesday, languishing below the key $2,000-per-ounce mark, pressured by a stronger-than-expected U.S. inflation report that caused investors to pull back on bets of rate cuts by the Federal Reserve.
 
 
Spot gold fell 0.1% to $1,991.10 per ounce as of 1130 GMT — its lowest since Dec. 13. Bullion fell about 1.4% on Tuesday, its biggest daily loss since Dec. 4...[LINK]
           
Posted By Zaner Precious Metals

Gold ekes out gains with focus on US inflation data

Tuesday, February 13, 2024 7:47:49 AM America/Chicago

Feb 13 (Reuters) - Gold prices edged higher on Tuesday as caution set in ahead of a U.S. inflation report that could offer more clues on the timing of widely expected interest rate cuts from the Federal Reserve.
 
 
Spot gold was up 0.4% at $2,027.99 an ounce by 1145 GMT, having briefly slipped to a more than two-week low of $2,011.72 in the previous session...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, February 12, 2024 8:25:30 AM America/Chicago

While gold and silver finished Friday with moderate losses for the day and week, they are starting with silver rallying to a one-week high and gold under pressure.
 
 
Platinum and palladium have rebounded off their 2024 lows. However, further gains are being held in check by ongoing Asian and European auto catalyst demand concerns.
 
 
Although they started a 1-week Lunar New Year holiday on Friday, China's economic concerns are not going away anytime soon, and they continue to weigh on the near-term demand outlook for both precious metals...[MORE]
 
 
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Posted By Zaner Precious Metals

Gold eases as U.S. CPI takes centre stage

Monday, February 12, 2024 7:59:11 AM America/Chicago

Feb 12 (Reuters) - Gold edged lower on Monday due to an uptick in the dollar, although prices were stuck in a tight range as investors looked forward to U.S. inflation data and comments from Federal Reserve officials this week.
 
 
Spot gold was down 0.2% at $2,021.13 per ounce, oscillating in a $5 range, at 1219 GMT. U.S. gold futures also fell 0.2% to $2,035.60 per ounce...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, February 8, 2024 8:21:46 AM America/Chicago

There has been notable divergence in precious metals with gold holding within its 2024 consolidation zone while silver is still within striking distance of a new 4-month low.

 

The gold/silver ratio was just above 92 at yesterday's close and approaching the 17-month high reached in mid-January.

 

The dollar remains well below Monday's 2 1/2-month high which has underpinned metals prices early today.

 

Fed speakers gave mixed comments on upcoming Fed policy yesterday, and the market's disappointment that there was not an overall dovish tone has weighed on gold and silver prices...[MORE]

 

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Posted By Zaner Precious Metals

Gold subdued as traders seek more Fed cues; palladium extends slide

Thursday, February 8, 2024 7:49:46 AM America/Chicago

Feb 8 (Reuters) - Gold prices eased on Thursday as dollar ticked higher, with investors awaiting more cues on the timing of the U.S. Federal Reserve's first interest rate cut this year, while palladium prices dropped to a fresh five-year low as demand concerns persist.
 
 
Spot gold fell 0.4% to $2,026.39 per ounce, as of 1230 GMT. U.S. gold futures lost 0.5% to $2,041.10 per ounce...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, February 7, 2024 8:32:56 AM America/Chicago

After a rough start to February, the tide may have turned for gold prices as they remain well clear of Monday's low.

 

Silver prices have reached a 2-week low while platinum and palladium are also under moderate early pressure.

 

The Dollar has extended its pullback after a surprise downtick from a private survey of US economic optimism, which carried more weight with the market than usual on Tuesday as there were no top-tier US economic numbers to digest...[MORE]

 

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Posted By Zaner Precious Metals

Silver set for a ‘terrific year’ and could outperform gold to hit a 10-year high

Wednesday, February 7, 2024 7:49:58 AM America/Chicago

This could be a banner year for silver, with prices potentially hitting a decade-high.

 

Global silver demand is forecast to reach 1.2 billion ounces in 2024, which would mark the second-highest level on record, the Silver Institute said in a recent report...[LINK]

           
Posted By Zaner Precious Metals

Gold stuck in tight range as traders await Fed rate-cut cues

Wednesday, February 7, 2024 7:40:48 AM America/Chicago

Gold prices were stuck in a relatively tight range on Wednesday as traders turned their attention to remarks from U.S. Federal Reserve officials through the week that may provide more clues on the interest-rate path this year.

 

Spot gold was last down 0.08% to $2,033.79 per ounce. U.S. gold futures fell 0.09% to $2,049.30 per ounce...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, February 6, 2024 7:57:16 AM America/Chicago

The sharp rally in the dollar has clearly undermined support for the precious metals, along with the break in Treasury prices.

 

Fed Chair Powell's comments on 60 Minutes put to rest any ideas that the Fed would consider cutting rates in March, and this sparked a breakout rally in the dollar to its highest level since November 14.

 

Comments from other Fed officials reinforced this stance, with Fed Governor Michele Bowman saying it is too soon to consider lowering interest rates and Chicago Fed President Austin Goolsby saying he wants to see more inflation progress...[MORE]

 

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Posted By Zaner Precious Metals

Gold languishes near more than one-week low on robust dollar

Tuesday, February 6, 2024 7:42:38 AM America/Chicago

Feb 6 (Reuters) - Gold prices were flat on Tuesday, languishing near a more than one-week low hit in the previous session, as the dollar held firm on growing expectations the Federal Reserve will not be more aggressive with rate cuts this year.
 
 
Spot gold was steady at $2,025.53 per ounce, as of 1218 GMT, after hitting its lowest since Jan. 25 in the previous session...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, February 5, 2024 8:18:45 AM America/Chicago

Not surprisingly, the gold market started off under noted pressure today with a six-day low largely because of the upside breakout in the dollar to the highest level since mid-November and from a slight increase in US treasury yields following a hawkish overnight speech from the US Fed chairman.

 

With the gold market adding to the January recovery rally last week before failing and reversing the market was giving off technical signs of an intermediate top last week.

 

Unfortunately for the bull camp, outside market impacts of the dollar and treasuries shifted patently bearishly after the much stronger-than-expected US nonfarm payroll reading...[MORE]

 

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Posted By Zaner Precious Metals

Gold drops to one-week low as Fed rate cut hopes wane

Monday, February 5, 2024 7:56:32 AM America/Chicago

Feb 5 (Reuters) - Gold prices slipped to a one-week low on Monday after a robust U.S. jobs data last week and remarks from Federal Reserve Chair Jerome Powell dented hopes for early rate cuts, lifting the dollar and bond yields higher.
 
 
Spot gold was down 0.6% at $2,025.99 per ounce by 1214 GMT, hitting its lowest since Jan. 29. U.S. gold futures fell 0.6% to $2,042.60 per ounce...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, February 2, 2024 8:20:12 AM America/Chicago

Clearly, the gold and silver markets are not benefiting from flight to quality interest early today as the fear of financial contagion in China continues to rise with Chinese equities plunging sharply this week. This is beginning to create "margin calls" which can prompt a chain reaction of problems for banks, investors, and eventually the government.

 

Sentiment toward gold early today is disappointing to the bull camp as a downside breakout in the dollar has not produced a wave of fresh buying yet.

 

In fact, it should be noted that the March dollar index fell below its 200-day moving average and posted a seven-day low in the early trade...[MORE]

 

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Posted By Zaner Precious Metals

Gold on track for best week since Dec, focus on U.S. jobs data

Friday, February 2, 2024 8:18:11 AM America/Chicago

Gold prices steadied on Friday as investors braced for U.S. non-farm payrolls data later in the day that could give hints on when the Federal Reserve might start cutting rates, but bullion was still headed for its biggest weekly rise since December.

 

Spot gold was down 0.1% to $2,054.29 per ounce. U.S. gold futures were up 0.1% to $2,071.40...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, February 1, 2024 8:10:05 AM America/Chicago

With the dollar posting a technical breakout on the upside this morning, gold and silver bulls are fortunate treasury yields have remained low overnight.

 

Global economic news overnight was mixed to slightly softer, which might be considered a negative to gold but more so to silver given its industrial focus.

 

However, the overriding weight on the back of gold prices this morning is clear sentiment from the US Fed chairman that a rate cut in their next meeting in March is not their base case...[MORE]

 

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Posted By Zaner Precious Metals

Gold drifts lower after Powell pushes back prospect of March rate cut

Thursday, February 1, 2024 7:59:37 AM America/Chicago

Jan 31 (Reuters) - Gold prices reversed course and edged lower on Wednesday after the Federal Reserve Chair Jerome Powell pushed back strongly against expectations of a U.S. rate cut by March.

 

Spot gold eased 0.1% at $2,034.37 per ounce by 03:10 p.m. ET (2010 GMT) after rising as much as 1% earlier in the session. Bullion was down 1.3% this month but have held above the $2,000 per ounce psychological level so far this year...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, January 31, 2024 8:19:23 AM America/Chicago

While the charts in gold tilt in favor of the bull camp, the upward bias is likely a simple drift toward the top of the last month and a half consolidation pattern.

 

Outside market influences early today are offsetting with supportive treasuries countered by minimal strength in the dollar.

 

The gold market is likely experiencing some headwinds following the release of the World Gold Council's latest report. In fact, global gold demand fell by 5% last year even without including the negative demand registered by outflows from ETF and OTC gold-based instruments...[MORE]

 

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Posted By Zaner Precious Metals

Gold set to end lacklustre January with eyes on Fed decision

Wednesday, January 31, 2024 7:44:29 AM America/Chicago

Jan 31 (Reuters) - Gold prices are set to end January in negative territory, snapping a three-month gaining streak on Wednesday, following lowered expectations of early interest rate cuts ahead of the U.S. central bank's outlook on policy rates later in the day.
 
 
Spot gold was flat at $2,037.30 per ounce by 1237 GMT, while U.S. gold futures rose 0.3% to $2,037.30...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, January 30, 2024 8:05:59 AM America/Chicago

With April gold breaking out to the highest level since January 19th, US interest rates continuing to decline, and a tight range bound dollar that leaves the bull camp with the edge.

 

Furthermore, the market should find fresh support from news that Indian 2023 gold imports in their latest fiscal year increased by 26.7%.

 

However, comparative Indian gold imports from the prior year were also sharply higher potentially suggesting an improved Indian gold import pattern...[MORE]

 

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Posted By Zaner Precious Metals

Gold prices edge up as traders brace for Fed rate decision

Tuesday, January 30, 2024 7:44:38 AM America/Chicago

Jan 30 (Reuters) - Gold prices ticked up on Tuesday supported by a slightly weaker dollar and lower Treasury yields as investors primed for the U.S. Federal Reserve's policy meeting for updates on the timing of its interest rate cuts.
 
 
Spot gold was up 0.1% at $2,032.70 per ounce by 1239 GMT. U.S. gold futures rose 0.4% to $2,032.60...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, January 29, 2024 8:06:33 AM America/Chicago

With a three-day high and a developing pattern of higher highs and higher lows, the technical picture for gold has improved.

 

However, with a stronger Dollar to start, the positive start in gold and silver might indicate the metals are embracing flight to quality uncertainty from China which saw a major property company forced by a Hong Kong Court to liquidate its assets.

 

The markets continue to see chatter regarding rate cuts from the ECB and stories suggesting the Fed is already acting which signal a pivot...[MORE]

 

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Posted By Zaner Precious Metals

Gold gains on Middle East risks; Fed meeting in focus

Monday, January 29, 2024 7:52:09 AM America/Chicago

Jan 29 (Reuters) - Gold prices firmed on Monday as growing concern over the Middle East bolstered bullion's safe-haven appeal while markets await this week's U.S. Federal Reserve policy meeting for a steer on interest rate expectations.
 
 
Spot gold gained 0.5% to $2,029.10 an ounce by 1325 GMT and U.S. gold futures were up 0.6% at $2,029.50...[LINK]
           
Posted By Zaner Precious Metals

Gold firms on softer dollar as market await US economic data

Wednesday, January 24, 2024 7:50:53 AM America/Chicago

Jan 24 (Reuters) - Gold eked out gains on Wednesday due to a lower dollar, as investors awaited a deluge of economic news in the U.S. this week for more clues on the pace and scale of the Federal Reserve's interest rate cuts.
 
 
Spot gold edged up 0.2% to $2,032.88 per ounce by 12:50 GMT. U.S. gold futures rose 0.42% to $2,034.30...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, January 23, 2024 8:23:39 AM America/Chicago

Apparently, severe losses in Chinese equity markets has prompted Chinese officials to consider implementing a $278 billion rescue package.

 

Therefore, gold may see some limited flight to quality buying interest, but as mentioned many times over the last year, the gold and silver trade are not as sensitive to flight to quality events as in the past.

 

On the other hand, if the situation becomes dire and there is a chance of contagion that could pull in a noted measure of spec and fund longs...[MORE]

 

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Posted By Zaner Precious Metals

Gold holds ground as markets look ahead for more Fed cues

Tuesday, January 23, 2024 8:05:51 AM America/Chicago

Jan 23 (Reuters) - Gold prices were little changed on Tuesday, as investors looked forward to more U.S. economic data this week that could set the tone for the Federal Reserve's policy meeting next week.
 
 
Spot gold was up 0.1% at $2,023.90 per ounce by 1223 GMT. U.S. gold futures rose 0.2% to $2,026.30...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, January 22, 2024 8:14:17 AM America/Chicago

While the US dollar is showing some vulnerability on its charts early today, treasury yields may have temporarily peaked leaving the primary outside market influences slightly supportive of gold.

 

However, we see no reason to take control away from the bear camp with the hedge funds reducing their long positioning last week, another week of ETF holding declines, an overbought net spec and fund positioning, a residual negative global commodity market environment, and perhaps most importantly from growing economic concerns in China.

 

With the last COT positioning report showing the net spec and fund long in gold near the highest levels since May 2022, falling trading volume and declining open interest on last week's recovery bounce, the bear camp retains control over the trend...[MORE]

 

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Posted By Zaner Precious Metals

Gold prices drop as US rate-cut hopes fade

Monday, January 22, 2024 7:32:26 AM America/Chicago

Jan 22 (Reuters) - Gold prices declined on Monday, as hopes of a March interest rate cut by the Federal Reserve faded, while traders awaited key U.S. economic data and major central bank policy meetings this week.
 
 
Spot gold was down 0.2% at $2,026.40 per ounce, as of 1237 GMT. U.S. gold futures were steady at $2,029.00...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, January 19, 2024 8:01:13 AM America/Chicago

While the gold and silver markets are showing initial strength this morning, outside market action leaves the bear camp with a prevailing edge.

 

In fact, despite initial weakness in the dollar, disastrous retail sales readings from the UK should leave the dollar in favor and physical commodities like gold off balance.

 

Furthermore, US treasury yields have clawed higher this week with yields overnight reaching the highest level since December 13th...[MORE]

 

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Posted By Zaner Precious Metals

Gold set for weekly fall as US rate cut hopes ebb

Friday, January 19, 2024 7:43:53 AM America/Chicago

Jan 19 (Reuters) - Gold drifted higher on Friday, buoyed by a weaker U.S. dollar but was set to log its biggest weekly decline in six after the Federal Reserve countered market expectations of an early interest rate cut.
 
 
Spot gold rose 0.5% to $2,032.90 per ounce by 1231 GMT but was down 0.8% so far in the week. U.S. gold futures rose 0.7% to $2,035.80...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, January 18, 2024 8:16:30 AM America/Chicago

While February gold did not post a lower low trade overnight, fundamental developments favor more declines and a trade below $2000.

 

In addition to hawkish ECB dialogue predicting no rate cuts until summer, expectations for a US cut have been pushed further into the future with US data continuing to signal an economy holding together which in turn has been accompanied by a consistent reduction in the probability of a first quarter US rate cut.

 

However, the bull camp should get some credit for prices tracking in positive territory this morning especially with the Chinese Premier discounting the prospects of a stimulus package from the government...[MORE]

 

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Posted By Zaner Precious Metals

Gold climbs as weaker dollar, safe-haven demand lend support

Thursday, January 18, 2024 7:52:01 AM America/Chicago

Jan 18 (Reuters) - Gold prices rose on Thursday, helped by a softer U.S. dollar and the Middle East conflict lifting safe-haven appeal, while investors await further comments from a Federal Reserve official to gauge the central bank's interest rate trajectory.
 
 
Spot gold rose 0.5% to $2,015.79 per ounce by 1255 GMT, but was lingering near its five-week low hit in the previous session...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, January 17, 2024 8:09:19 AM America/Chicago

Fortunately for the bull camp in gold and silver the upside breakout extension in the dollar overnight has been offset by a minimal decline in US treasury yields.

 

However, the charts in the dollar project higher action ahead, and the US economic reports slate today is very active potentially rekindling rate cut timing debate.

 

In the end, the dollar is underpinned, and gold is pressured from Fed Gov. Waller's comments yesterday cautioning the Fed against rushing to cut rates before establishing inflation has been slayed...[MORE]

 

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Posted By Zaner Precious Metals

Gold subdued near one-week low as dollar firms on hawkish Fed remarks

Wednesday, January 17, 2024 7:51:55 AM America/Chicago

Jan 17 (Reuters) - Gold prices were flat on Wednesday after hitting an almost one-week low, pressured by a stronger dollar as hawkish comments from a Federal Reserve official diminished hopes of a U.S. interest rate cut in March.
 
 
Spot gold was flat at $2,027.29 per ounce, as of 1245 GMT. It fell 1.3% in the previous session in its biggest single-day decline since Dec. 4...[LINK]
           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, January 16, 2024 8:43:49 AM America/Chicago

In addition to gapping higher overnight, the dollar index reached the highest level since December 13th in a reaction that appears to carry follow-through potential.

 

Adding to the bearish track for gold and silver to start the new trading week, US treasury yields are climbing and gold ETF holdings at the end of last week had posted nine straight days of outflows, with holdings last week reduced by 656,635 ounces. Year-to-date gold ETF holdings are already down 1.2% while silver ETF holdings are down only 0.6% year-to-date.

 

From a longer-term perspective, the gold market could see lift from Chinese President Xi Jinping who announced China would push for high-quality development of its financial sector and would accelerate the creation of a modern financial system as that necessitates the need for a faster expansion of Chinese central bank gold reserves to backstop its currency in the eyes of the world trade...[MORE]

 

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Posted By Zaner Precious Metals

Gold retreats as US dollar, yields climb; Fed speakers on tap

Tuesday, January 16, 2024 8:05:07 AM America/Chicago

Jan 16 (Reuters) - Gold prices declined on Tuesday, hurt by a strengthening dollar and Treasury yields, as markets wait to hear remarks from several Federal Reserve officials this week to further gauge the central bank's monetary policy path.

 

Spot gold was down 0.8% at $2,037.40 per ounce, as of 1212 GMT. U.S. gold futures fell 0.5% to $2,041.50...[LINK]

           
Posted By Zaner Precious Metals

Gold rises as safe-haven demand, rate cut bets keep prices elevated

Monday, January 15, 2024 9:46:25 AM America/Chicago

Jan 15 (Reuters) - Gold prices advanced on Monday, as the metal's appeal was boosted by safe-haven demand owing to tensions in the Middle-East, while markets raised bets that the Federal reserve will cut rates sooner than expected.

 

Spot gold was up 0.3% at $2,053.51 per ounce, as of 1320 GMT. U.S. gold futures rose 0.3% to $2,058.00, with trading expected to be low due to the Martin Luther King Day holiday...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, January 12, 2024 8:30:43 AM America/Chicago

With the dollar slightly higher and US treasuries flat a $24 rally in gold and a $0.40 rally in silver is likely the result of US and Great Britain attacks on suspected Yemeni terrorists' strongholds inside Yemen.

 

Apparently, the oil and precious metal markets see the onshore strikes in Yemen as an escalation and perhaps a catalyst for an expansion of military aggression in the area.

 

While the crude oil market is only up $2.40, a flight-to-quality situation is unfolding and has sparked an unusual migration to gold and silver...[MORE]

 

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Posted By Zaner Precious Metals

Gold firms as Middle East concerns boost safe-haven demand

Friday, January 12, 2024 8:17:04 AM America/Chicago

Jan 12 (Reuters) - Gold prices gained on Friday as fears of escalating conflict in the Middle East lifted the appeal of the safe-haven metal despite stronger than expected U.S. inflation data boosting the dollar and Treasury yields.

 

Spot gold was up 1% at $2,048.20 an ounce at 1254 GMT, extending its run above the $2,000 level to nearly a month. U.S. gold futures were up 1.7% at $2,053.50...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, January 11, 2024 8:09:10 AM America/Chicago

While events that are widely anticipated to present significant volatility can sometimes be disappointing with a muted response, the stakes for many financial markets are significant today as the pendulum of expectations for an early US rate cut has been pulled down with a series of US Fed speeches generally indicating the fight against inflation is not complete yet.

 

Fortunately for the bull camp in gold and silver the action in bond and dollar markets this week has not shifted definitively bearish from the reduction in rate cut expectations but today presents a possible breakout session with a dollar trade above 102.385 a big problem for the bull camp.

 

On the other hand, a trade in the dollar below 101.835 could save the day for the bull camp and launch February gold above $2050...[MORE]

 

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Posted By Zaner Precious Metals

Gold rises on the back of weaker dollar; US inflation data in focus

Thursday, January 11, 2024 7:45:17 AM America/Chicago

Jan 11 (Reuters) - Gold prices climbed on Thursday, buoyed by a softer dollar, while markets awaited a key U.S. inflation report later in the day that could help gauge the Federal Reserve's policy trajectory this year.

 

Spot gold was up 0.5% at $2,033.70 per ounce, as of 1206 GMT. U.S. gold futures also rose 0.6% to $2,038.90...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, January 10, 2024 8:18:46 AM America/Chicago

While it appears gold and silver have settled into sideways consolidation patterns, that is likely to end with tomorrow's US CPI report, especially if a slightly hotter reading is posted. However, analysis of the data is difficult given the potential for fractional change.

 

The range trade is certainly justified considering that neither gold nor silver has a definitive internal fundamental driven bias with prices of gold within proximity to all-time highs and the speculative positioning in gold futures and options leaving the market vulnerable to stop loss selling on violations of key support.

 

With the US dollar posting a higher high yesterday and posting a higher low, and treasury prices likely to remain capped, the gold market could fail at the $2,025 level in the coming sessions...[MORE]

 

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Posted By Zaner Precious Metals

Gold gains on softer dollar, US inflation data on radar

Wednesday, January 10, 2024 7:50:48 AM America/Chicago

Jan 10 (Reuters) - Gold prices edged up on Wednesday, supported by a slightly weaker U.S. dollar ahead of a critical inflation report that could offer some clues on whether the Federal Reserve will begin cutting interest rates this year.

 

Spot gold gained 0.2% to $2,033.90 per ounce, as of 1148 GMT. U.S. gold futures rose 0.3% to $2,040.00 per ounce...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, January 9, 2024 8:20:04 AM America/Chicago

While gold has recovered from yesterday's spike-down move and has spent the overnight trade in positive territory, the charts have not reversed course and we suspect more declines ahead which in turn should pull down open interest.

 

In fact, it should be noted that the declines in gold have been accompanied by periodic jumps in trading volume which we think confirms the downward tilt.

 

While gold has seen outside market influence wain, treasury prices appear to be trending negative for gold, and we see the general impact from outside markets as bearish in the near term...[MORE]

 

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Posted By Zaner Precious Metals

Gold gains as traders find comfort in Fed rate cut hopes

Tuesday, January 9, 2024 8:07:43 AM America/Chicago

Gold prices rose on Tuesday after touching a three-week low in the previous session as traders reassessed interest rate cut expectations from the Federal Reserve after a report showed consumers expect lower inflation this year.

 

Spot gold was up 0.5% at $2,038.99 per ounce after hitting its lowest level since Dec. 18 on Monday. U.S. gold futures rose 0.6% to $2,045.4 per ounce...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, January 8, 2024 8:08:39 AM America/Chicago

With a fresh lower low and the lowest trade since December 13th in February gold overnight the downtrend of the last two weeks looks to extend.

 

Certainly, the gold bulls were initially heartened by the failure to sustain dollar gains after a better-than-expected US jobs report but given the lack of definitively bullish internal fundamental storylines for gold, the bull camp "needs" a definitively weaker dollar!

 

Not surprisingly, investors remain cool toward gold with ETF holdings last week falling by 349,662 ounces leaving holdings down 0.4% early in the new year...[MORE]

 

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Posted By Zaner Precious Metals

Gold wavers near 3-week lows as investors brace for US inflation data

Monday, January 8, 2024 7:48:01 AM America/Chicago

Jan 8 (Reuters) - Gold prices slid on Monday to trade near a three-week low touched in the last session, as the U.S. dollar and bond yields were buoyant on reduced hopes of an early rate cut by the Federal Reserve and as markets awaited for a key inflation print this week.

 

Spot gold slipped 0.9% at $2,027.87 per ounce as of 1033 GMT, hovering near its lowest level since Dec. 19 touched in the last session. U.S. gold futures GCcv1 fell 0.7% to $2,034.40...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, January 5, 2024 8:26:35 AM America/Chicago

With a rising dollar and rising interest rates pressuring the markets again this morning and the prospect of US rate cut being pushed back with further strong US jobs data today the slide from the late December high is likely to extend in earnest today.

 

In other words, without a surprisingly weak jobs report reductions in the probability of a March rate cut should continue.

 

Keep in mind, US non-farm payroll counts are still "growing" (albeit monthly additions are shrinking) and impatient bond traders have started to question their perception of the potential for a March cut...[MORE]

 

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Posted By Zaner Precious Metals

Gold under pressure from stronger US dollar, Treasury yields

Friday, January 5, 2024 7:55:58 AM America/Chicago

Jan 5 (Reuters) - Gold prices slipped on Friday and were on track for their first weekly fall in four, weighed down by a stronger dollar and higher bond yields, while investors keenly awaited U.S. non-farm payrolls data due later in the day.

 

Spot gold was down 0.2% to $2,038.49 per ounce as of 1223 GMT. U.S. gold futures fell 0.2% to $2,045.40...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, January 4, 2024 8:23:26 AM America/Chicago

The weakening dollar gives the gold bulls the upper hand this morning.

 

Although the depth of this bull move is questionable as many bond traders have cut their March rate cut probabilities to 70%, from 85%, sending US rates higher.

 

With other nations potentially cutting interest rates more aggressively than the Fed, the dollar is at risk of staying stronger than expected, putting pressure on gold prices, even despite potential rate cuts. Gold bulls must take this shift in timing and probabilities seriously...[MORE]

 

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Posted By Zaner Precious Metals

Gold rebounds on dollar retreat; spotlight on US jobs data

Thursday, January 4, 2024 8:14:17 AM America/Chicago

Jan 4 (Reuters) - Gold prices rebounded from a two-week low on Thursday, as a pullback in the dollar lifted demand among investors who are looking ahead to a U.S. jobs report that could shed more light on the Federal Reserve's next move on interest rates.

 

Spot gold was up 0.2% to $2,044.69 per ounce as of 1210 GMT, after hitting its lowest since Dec. 21 on Wednesday. U.S. gold futures rose 0.5% to $2,052.10 per ounce...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, January 3, 2024 8:15:27 AM America/Chicago

The gold bears were out this morning as worries over Japanese insurers dumping U.S. government bonds, to cover losses related to this week's earthquakes, sent both bond yields and the dollar sharply higher.



This gold sell-off comes as central banks continue to talk about the need for weaker economic data before they discuss rate cuts, and, on cue, we saw better-than-expected employment data in Europe, adding to worries of a slower-than-expected central bank pivot.



Furthermore, the trade today could see early selling intensify if US ISM manufacturing data comes in positive as expected especially with the afternoon release of the FOMC meeting minutes as any pushing back of US rate cut timing is clearly a major blow to the bull case...[MORE]

 

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Posted By Zaner Precious Metals

Gold slips to one-week low as dollar firms ahead of Fed minutes

Wednesday, January 3, 2024 7:47:12 AM America/Chicago

Gold prices slipped to their lowest in a week on Wednesday as the dollar firmed, while investors looked ahead to the release of minutes from the Federal Reserve’s latest policy meeting and U.S. jobs data for more clarity on potential interest rate cuts.

 

Spot gold was down 0.3% to $2,053.10 per ounce. U.S. gold futures were down 0.5% to $2,062.20 per ounce...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, January 2, 2024 8:05:14 AM America/Chicago

The bulls started the New Year in control as gold prices rallied in the early morning after Israel attacked Syria in response to a rocket attack, and Turkey arrested 33 Israeli "spies".

 

There is fear that this might be the start of a deeper regional destabilization following the US Navy's sinking of three Houthi ships in the Red Sea, and Iran sending a warship into the Red Sea.

 

US interest rates were higher overnight and the dollar managed to rally sharply to start the year...[MORE]

 

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Posted By Zaner Precious Metals

Gold to enter 2024 with sights set on record highs

Tuesday, January 2, 2024 7:50:49 AM America/Chicago

Dec 29 (Reuters) - Gold investors anticipate record high prices next year, when the fundamentals of a dovish pivot in U.S. interest rates, continued geopolitical risk, and central bank buying are expected to support the market after a volatile 2023.

 

Spot gold is on track to post a 13% annual rise in 2023, its best year since 2020, trading around $2,060 per ounce...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, December 28, 2023 7:59:26 AM America/Chicago

The early corrective action in gold and silver this morning is very surprising, especially with the dollar breaking out and posting the lowest trade since the second half of July.

 

Certainly, a slight uptick in implied treasury yields suggests the rate-cut mentality is at least temporarily overplayed.

 

On the other hand, today's US initial and ongoing claims data will likely revive the rate cut watch with the probability of Fed easing rising incrementally with each soft US data point...[MORE]

 

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Posted By Zaner Precious Metals

Gold climbs to over three-week high on US rate cut bets

Thursday, December 28, 2023 7:35:22 AM America/Chicago

Dec 28 (Reuters) - Gold prices steadied after hitting a more than three-week high on Thursday, deriving support from a weaker U.S. dollar and lower bond yields as markets bet on rate cuts by the Federal Reserve early next year.

 

Spot gold was steady at $2,072.09 per ounce at 1206 GMT after earlier rising as high as 2,088.29, the most since Dec. 4. U.S. gold futures were down 0.5% at $2,082.20...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, December 27, 2023 9:10:53 AM America/Chicago

With a new low for the move in the dollar early today and slightly weaker treasury rates, gold and silver bulls look to extend their recent control.

 

In addition to the constant lift from the fully entrenched expectation of lower global rates gold and silver are likely to benefit from favorable Chinese industrial profit results as China remains the number one consumer of gold.

 

Apparently, the Chinese central bank has predicted China will achieve its 5% growth target next year and that combined with signs of continued cash infusions from the Bank of India provides a very solid demand base...[MORE]

 

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Posted By Zaner Precious Metals

Gold holds steady as activity muted, headed for best year in three

Wednesday, December 27, 2023 8:24:53 AM America/Chicago

Gold prices steadied on Wednesday as trading was muted in the last week of the year, but bullion was headed for its best year in three on expectations the Federal Reserve will cut rates in the first quarter of 2024.

 

Spot gold was flat at $2,067.14 per ounce, not far from an over two-week high of $2070.39 hit on Friday. Bullion was on track to mark an over 10% gain this year — its best since 2020...[LINK]

           
Posted By Zaner Precious Metals

Gold prices firm on Fed rate-cut prospects

Tuesday, December 26, 2023 7:56:21 AM America/Chicago

Gold prices rose on Tuesday, helped by a weaker U.S. dollar and lower Treasury yields on expectations that the Federal Reserve will lower interest rates next year.

 

Spot gold was up 0.4% at $2,062.63 an ounce near 7:30 a.m. ET after hitting a more than two-week high of $2,070.39 in the previous session. U.S. gold futures rose 0.2% to $2,073.20...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, December 21, 2023 8:26:40 AM America/Chicago

Contrasted with historic inflation/gold price patterns, further evidence of "sharply falling" global inflation provides gold and silver with ongoing fundamental cushion.

 

In other words, "significant" declines in UK, eurozone, and Italian inflation (Italian year-over-year producer prices declined by a startling 12.6%) directly or indirectly provide the US Fed with evidence that US inflation is also poised to fall.

 

While the CME Fed funds watch tool has not registered a significant increase in the probability of a March US rate cut this week, it is possible that reality is catching up with what the Feds Goolsbee earlier this week indicated was market expectations for cuts running ahead of the Fed's internal dialogue...[MORE]

 

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Posted By Zaner Precious Metals

Gold range-bound as market focuses on US economic data

Thursday, December 21, 2023 8:16:43 AM America/Chicago

Dec 21 (Reuters) - Gold prices crept higher on Thursday, but traded in a relatively tight range as investors looked to U.S. economic data for further clarity on the Federal Reserve's next monetary move.

 

Spot gold was up 0.3% at $2,034.79 per ounce, as of 1217 GMT, trading in a narrow $10 range in the session so far. U.S. gold futures fell 0.1% to $2,046.30...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, December 20, 2023 8:33:02 AM America/Chicago

With some global inflation readings plummeting overnight and others coming in below expectations, the prospect of rate cuts next year has improved again.

 

In fact, the CME Fed watch tool raised prospects of a January 31st cut by 4% to 12.4% and increased its March rate cut prospect to 71%.

 

However, despite renewed rate cut chatter and a downward bias in the dollar both gold and silver are trading lower signaling a lack of bullish sensitivity today...[MORE]

 

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Posted By Zaner Precious Metals

Gold holds steady on Fed rate-cut hopes; focus on U.S. inflation print

Wednesday, December 20, 2023 7:56:42 AM America/Chicago

Gold prices held steady above the key $2,000 level on Wednesday, supported by prospects of interest rate cuts from the Federal Reserve next year, while investors awaited U.S. inflation numbers later this week.

 

Spot gold was little changed at $2,032.60 per ounce, as of 0131 GMT. U.S. gold futures fell 0.2% at $2,046.10...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, December 19, 2023 8:42:40 AM America/Chicago

The path of least resistance in gold is down with hawkish dialogue from the Chicago Fed President yesterday, November Swiss gold exports dropping 28% (mostly because the world's second-largest consumer India imported 67% less gold from Switzerland), and from a lack of corrective action in the dollar following last weeks compacted rally.

 

However, an offset to the negative demand signals from declining Swiss gold exports is the fact that Chinese purchases from Switzerland increased by ten percent on 25 tons in sales versus the lower 16.4 ton sales to India.

 

With both volume and open interest falling off and given the reversal from last week's highs, we suspect the bullish bias from last week has run its course...[MORE]

 

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Posted By Zaner Precious Metals

Gold prices are steady as uptick in U.S. dollar offsets falling yields

Tuesday, December 19, 2023 7:55:27 AM America/Chicago

Gold prices were subdued on Tuesday as a slight uptick in the dollar countered support from falling Treasury yields, while investors await U.S. economic data due this week that could further illuminate the Federal Reserve’s interest rate path.

 

Spot gold was steady at $2,026.30 per ounce. U.S. gold futures were also flat at $2,041.20...[MORE]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, December 18, 2023 8:52:33 AM America/Chicago

Despite a lack of direction in the dollar in the early going today, the gold market remains vulnerable on its charts but supported by global central bank dovishness.

 

While we suspect gold and silver will take a huge amount of direction from the dollar and from US treasuries there is a developing physical demand threat from ongoing malaise in the Chinese economy.

 

The struggling Chinese economy is partially verified by ongoing weakness in Chinese equity markets relative to the very impressive gains in global equity markets...[MORE]

 

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Posted By Zaner Precious Metals

Gold rebounds on US dollar, yield weakness after Fed’s dovish tilt

Monday, December 18, 2023 8:28:50 AM America/Chicago

Gold prices climbed on Monday, buoyed by a weaker dollar and bond yields as markets awaited U.S. inflation data due this week to ascertain the Federal Reserve’s policy path after a dovish spin last week.

 

Spot gold was up 0.3% at $2,025.49 per ounce. U.S. gold futures were higher by 0.2% at $2,039.40...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, December 15, 2023 8:28:29 AM America/Chicago

Despite a building overbought condition in gold and silver, prices continue to extend on the upside this morning in what we consider long-term fundamental-based investment trading.

 

Evidence of the bulls piling on the trade was seen overnight from Commerzbank predicting gold to reach $2150 in the second half of next year and silver to reach $30 per ounce by the end of next year.

 

As we have indicated in financial market coverage all week the magnitude of the anticipated pivot by the Fed, after a historic rate hike cycle obviously justifies a significant and sustained reaction in precious metal prices...[MORE]

 

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Posted By Zaner Precious Metals

Gold set for weekly gain on Fed’s interest rate pivot

Friday, December 15, 2023 7:50:01 AM America/Chicago

Gold prices were on track for a weekly jump, driven by a weaker U.S. dollar and lower Treasury yields, after the Federal Reserve indicated lower borrowing costs next year.

 

Spot gold, which edged up 0.3% at $2,041.70 per ounce, has risen 1.9% so far this week. U.S. gold futures gained 0.6% to $2,056.40...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Thursday, December 14, 2023 8:31:54 AM America/Chicago

The gold and silver trade is euphoric over what the trade is calling an official pivot by the US Fed toward cutting interest rates as the rallies from yesterday's lows are quite profound and appear to have momentum.

 

As in other markets, near-term overbought technical signals in gold and silver should be ignored by the markets today, as traders continue to embrace euphoria which is likely to extend through today's session.

 

Obviously, the sharp slide in the dollar and the precipitous drop in interest rates combined with a dovish Fed is a perfect bullish storm that is likely to be capable of attracting buying fuel despite a quickly expanding and overdone net spec and fund long positioning...[MORE]

 

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Posted By Zaner Precious Metals

Gold firms as Fed’s rate cut forecast hurts dollar, yields

Thursday, December 14, 2023 8:04:24 AM America/Chicago

Gold prices extended gains on Thursday, after the U.S. Federal Reserve signaled an end to its tightening cycle and lower borrowing costs in 2024, which sent the dollar and Treasury yields lower.

 

Spot gold was 0.4% higher at $2,034.35 per ounce, after surging 2.4% on Wednesday. U.S. gold futures jumped 2.6% to $2,049...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Wednesday, December 13, 2023 8:29:44 AM America/Chicago

Downtrends in gold and silver are likely to extend with initial US inflation readings soft but the dollar does not show definitive weakness from that news.

 

In fact, further evidence of the negative bias toward gold and silver is the lack of support from a resumption of a falling US interest rate environment.

 

The bear camp should also be emboldened by the prospects of slumping Chinese physical demand as troubles in the Chinese economy (verified by continued weakness in Chinese equity markets and a disappointing new loan report) should crimp Chinese gold imports...[MORE]

 

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Posted By Zaner Precious Metals

Gold creeps higher on weaker US bond yields, traders brace for Fed

Wednesday, December 13, 2023 7:46:10 AM America/Chicago

Dec 13 (Reuters) - Gold prices edged up on Wednesday, buoyed by weaker Treasury yields, but bullion was still near its lowest in over three weeks as the dollar inched higher ahead of the U.S. Federal Reserve's interest rate decision and policy outlook.

 

Spot gold gained 0.1% at $1,981.30 per ounce, as of 1157 GMT. U.S. gold futures rose 0.2% to $1,997.60...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Tuesday, December 12, 2023 8:23:26 AM America/Chicago

The precious metals have stayed within a fairly tight trading range and are holding onto a mild positive tone coming into this morning's action.

 

A pullback in the Dollar has provided gold and silver with early support in front of this morning's critical US inflation data after gold and silver moved below their 200-day moving averages yesterday.

 

Expectations for a soft US CPI report later today should strengthen the bull case if the report matches expectations of a gain of 0.1%...[MORE]

 

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Posted By Zaner Precious Metals

Gold drifts upwards as dollar dips ahead of US inflation print

Tuesday, December 12, 2023 7:50:07 AM America/Chicago

Dec 12 (Reuters) - Gold prices recovered from a three-week low hit the previous session, as a weaker dollar provided support on Tuesday ahead of U.S. inflation data and major central bank policy meetings expected to yield clues on interest rates.

 

Spot gold was up 0.4% at $1,988.69 per ounce, as of 1211 GMT. U.S. gold futures rose 0.5% to $2,004.10...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Monday, December 11, 2023 8:46:44 AM America/Chicago

Given the fundamental and technical events of the last two weeks, the trend in gold and silver has shifted back in favor of the bear camp.

 

From a technical perspective, the massive rally last week exhibited a classic blowoff top and reversal with confirmation from an explosion in trading volume and a subsequent decline in open interest.

 

From a fundamental perspective, the mainstay of the bull case in precious metal markets since October has been a weakening dollar which now appears to have recovered especially with the market's decision that despite signs of US slowing, the US will likely hold up better than most in the face of the lagged headwinds from the unprecedented rate hike cycle...[MORE]

 

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Posted By Zaner Precious Metals

Gold prices fall on a firm dollar as spotlight moves to U.S. CPI data

Monday, December 11, 2023 8:06:54 AM America/Chicago

Gold prices declined on Monday pressured by a firm U.S. dollar, as investors look ahead to several major central bank meetings and U.S. inflation data this week for further clarity on the interest rate path.

 

Spot gold was down 0.4% at $1,994.70 per ounce. U.S. gold futures eased 0.3% to $2,009.10...[LINK]

           
Posted By Zaner Precious Metals

Zaner Daily Precious Metals Commentary

Friday, December 8, 2023 7:59:50 AM America/Chicago

Predicting the reaction in gold and silver to today's US payroll report is difficult as the precious metal trade this week has periodically delinking with key outside market drivers in place over the prior two months.

 

Recently, the focus of gold and silver has shifted primarily to the dollar with US treasury rates a secondary and inconsistent influence.

 

Pushed into the market, we favor the bear track with the aggressive blowoff reversal and a follow-through slide in gold and silver prices this week threatening the bull camp...[MORE]

 

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Posted By Zaner Precious Metals

Gold poised for first weekly drop in four before US jobs data

Friday, December 8, 2023 7:32:58 AM America/Chicago

Dec 8 (Reuters) - Gold prices were flat on Friday, as markets looked forward to the crucial U.S. jobs data for more clues on the Federal Reserve's monetary policy decision, although a firmer dollar kept bullion on track for its first weekly fall in four.

 

Spot gold was up 0.1% at $2,029.49 per ounce by 1203 GMT. Bullion, however, has fallen nearly 1.9% for the week so far. U.S. gold futures were flat at $2,046.00...[LINK]