GOLD CONSOLIDATING WHILE SILVER MAKES NEW HIGHS
| 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 week, Gold showed great price support above the key $2,150 per ounce level. Gold tested that key support level three of the five days and held while rallying back on solid trading volume. It was a great example of consolidation while building a firm base for the next leg higher. Gold has gone up $103 (5%) this month, closing at $2,157 per ounce on Friday.
Gold’s consolidation last week was an excellent bullish sign considering that the U.S. Dollar index traded back above 103 and the U.S. 10-Year Treasury bill moved above 4.30%. Plus, the wholesale inflation index increased 0.6% for February, much higher than expected. Gold is normally negatively affected by all three of these indicators. However, strong demand for physical metal from Asia, the Middle East, and Central banks has resulted in sizeable rallies on short-term sell-offs to lower price levels.
If Gold can stay in the $2,150 to $2,190 trading range for the balance of the month, it would be bullish. Breaking below that key level could cause short-selling by professional traders that could drive the price down to $2,100 per ounce. There could be some strong indicators released by the Federal Reserve this week that may lower interest before June.
Coming next week, we have some interesting economic reports and press conferences that will have an effect on the Gold price: the February housing starts and building permits on Tuesday, the FOMC interest-rate decision and Fed Chair Powell’s press conference on Wednesday, the initial March jobless claims report, and existing home sales for February on Thursday.
Today: Gold reached a low of $2,145 this morning as the market is accepting the idea that the Federal Reserve is likely not to lower interest rates until June. Buyers came in at the lows of the day and the price quickly moved back above the $2,150 level. Traders are awaiting any announcement from the Fed later this week.
Silver has been the strongest metal during the month of March so far. With Gold up 5% this month, Silver has rallied $2.54 (11.2%). Silver closed Friday at $25.20 per ounce on excellent trading volume. During the month of March, the Silver-to-Gold ratio has dropped 5% to 85-to-1. Staying above the key $25 price level is important for the near term direction of the price of Silver. A two-week or more consolidation above $25 per ounce will help create a strong base for Silver’s rally to the $30 level.
Today: Silver briefly reached a low of $24.93 this morning, but quickly turned around and rallied back over the $25 level as the Gold price firmed. Demand for physical investment Silver products remains strong in Asia, the Middle East, and Europe.
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