Gold And Silver Test The Lows And Are Moving Higher
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Stuppler & Company is proud to provide our clients this Weekly Market Report (WMR). The report gives you my overview of the prior week’s precious metal and rare coin market activity and news. In each WMR I share the current status of Gold and Silver along with their support and resistance levels. |
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This Week's Headlines: |
Last Friday, Gold closed over the key $1,800 level for the first time since November 22nd. Gold closed Friday at $1,803.80 per ounce, up $20 for the week.
Last Wednesday the Federal Open Market Committee had their December meeting. At that meeting, Chairman Powell made the distinction between the ending point of bond tapering and the onset of economic lift-off. He said that as far as the initiation of rate hikes, it will be data-dependent as we look at levels of employment and initiate interest rate normalization till they have determined that the country is at maximum employment.
The anticipation is that the first-rate hike will begin approximately in June 2022, which was construed as a bullish statement both for U.S. equities and Gold. Both U.S. equities and Gold prices came off of their lows as Chairman Powell spoke about when they would begin to raise interest rates next year even though they have penciled in a total of three rate hikes in 2022. This is bullish for precious metals and Gold moved back above $1,800 per ounce.
Fed Chairman Jerome Powell answered questions following Wednesday’s central bank monetary policy announcement. During the questions and answers period, the Gold market rallied $20 per ounce, and reached a high of $1,817 the next day.
As we approach the end of 2021, I expect to see the Gold price finish strong. December has been a good month for the Gold price during the past four years and last year showed an increase of over $100 in the month of December.
Today: With the U.S. Dollar Index and interest rates moving higher this morning, Gold is locked in a tight trading range between $1,792 and $1,802 per ounce. We need to move back above the key $1,800 soon.
Silver reached the low of the year $21.41 on Wednesday before seeing the FOMC rally. That rally caused the Silver price to increase by $1.28 by Friday, as many professional commodity trades covered their short-sales before the weekend. I continue to believe that the current low price of Silver is an over-reaction to the recent COVID-19 news and the sell-off in most of the equity markets. Silver under $23.00 is an extraordinary bargain, especially with a Silver-to-Gold ratio at 80.10-to-1.
Today: This morning Silver sold off a little with Gold, trading between $22.17 and $22.42. With Silver at the current level, we are seeing strong demand for many of the popular 2021 investment items and many of the pre-order 2022 items.
