Archives of “Gold / Silver” category

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Gold surges to its highest levels since April 2018

  
Analysis, Gold / Silver

A quick surge higher sees gold move past $1,350

Gold 14-06
Bullion takes out the highs for the year and is running stops above $1,350 as price looks to break out to test the highs of last year again. Gold has been on a tear in recent weeks as global central banks grow increasingly dovish amid global trade tensions, which has helped to reestablish the allure in the commodity as a safe haven.
With the break higher here and the backdrop of major central banks starting to send more dovish signals, it’s hard to argue that gold’s gains will top out near last year’s highs around $1,357 to $1,365. If the Fed is going to follow through on rate cuts with more to come, gold will easily stand out as one of the best performers this year.

Gold continues to shine amid global trade tensions, what’s in store next?

  
Analysis, Gold / Silver

Gold is up another 0.9% today as buyers stay in control

Gold D1 03-06
With gold having shook off its status as a proxy dollar trade, it has regained its previous allure of being a haven asset in times of uncertainty and risk aversion. With global trade tensions reignited in the past week, gold has been a standout performer from around $1,275 to now inch above $1,316 and also rise above the 100-day MA (red line).
That puts buyers back in the driver’s seat and with risk sentiment still cautious and unnerving, there’s still potential for bullion to post more gains as resistance is next seen only around $1,326 before the February high around $1,346.80 comes into play.
But besides the theme of risk aversion and haven flows, what else is next for gold beyond global trade tensions?
I reckon the next spot to watch will be the Fed. A key barometer for the global economy is how confident is the Fed in maintaining their current policy stance. Should they start shifting towards sending a message of rate cuts, expect that to have significant reverberations throughout emerging markets and risk assets in general.
In essence, the Fed signaling rate cuts can be argued as a possible tipping point for which traders will believe that an economic downturn is coming. In that regard, a weaker dollar and flows out of emerging markets should promote further strength in gold.
As such, global trade tensions will keep gold underpinned for the time being but for the commodity to really make its next run higher, that conviction lies with the Fed.

Gold hits 6-week high on increasing belief in central bank cuts

  
Analysis, Gold / Silver

Gold up $17 today

Gold up $17 today
In a world of uncertainty, gold shines ever-brighter.
That’s certainly the case today with Trump announcing new tariffs and risk assets getting beaten up. Gold is up $17 to $1306.
The rally breaks the May high of $1303 and means the precious metal will close the month at the highs.
Gold also rallied nicely in the Nov-Dec period on a similar round of fears about trade. The upside here is considerable but it will need to coincide with a deteriorating in economic data.
The Fed funds market is pricing in a 73% chance of two Fed rate cuts this year.

Gold – here is who is buying less (and why there is a surplus in the market)

  
Analysis, Gold / Silver

Latest data from the World Gold Council, quarterly report for Q1 2019:

Council estimates global central banks purchased 145.5t of gold in 1Q19
(up 68% y/y but, but down on the 165.6t purchased in 4Q18 … note that a peak of 253t in 3Q18)
  • other sectors (includes jewellery and ETF investment) slowed, demand down 17% q/q  to 1,060t in 1Q19
Gold supply down  4% q/q to 1,150t
Adds ING analysts:
  • leaving the market with a net surplus of 90t in 1Q19
Latest data from the World Gold Council, quarterly report for Q1 2019:
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The World Gold Council (this from their site):
  • is the market development organisation for the gold industry. Our purpose is to stimulate and sustain demand for gold, provide industry leadership, and be the global authority on the gold market. 
Just so you know, right?
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