Gold & Silver Testing Key Support Level
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. |
This Week's Headlines: |
When the U.S. market opened last Tuesday, the Commerce Department reported that June Retail sales increased only 0.2%. In May that number was 0.5%. Lower retail sales numbers put pressure on the Federal Reserve not to raise the Fed Funds rate this week. The U.S. Retail sales number helped Gold reach $1,980 per ounce on Wednesday.
However, during last Thursday and Friday’s trading many of the world’s largest developed countries reported higher inflation numbers. This caused the U.S. Dollar index to rally from under 99.60 to 101.30, putting pressure on precious metal prices. Gold traded above the $1,950 per ounce support level all last week and closed at $1,962, up $6 for the week.
The Federal Reserve Open Market Committee has a two-day meeting this week. It is scheduled for July 25-26. It is expected that the Fed will raise the Fed Fund rate by 1/4 %. However, no increase would be very bullish for both Gold and Silver prices.
Today: Gold is trading in a tight range today, between $1,957 and $1,967 per ounce. Investors are waiting for Wednesday’s monetary policy announcement from the Federal Reserve amid heightened speculation that it’s likely to be the last interest rate hike in this cycle. The U.S. Dollar Index continues to hold around recent highs.
Last week, the Silver price pretty much followed Gold higher and lower. However, on Thursday and Friday Silver couldn’t hold up above the key $25 per ounce level. Silver closed the week at $24.62 per ounce, down $0.40 for the week.
A combination of increased world mint production and a normal summer slump in demand have caused premiums on many of the popular Silver coins to drop. The premium on the very popular U.S. Silver Eagle is now at spot Silver plus only $7 per ounce.
Today: Silver reached a low of $24.22 this morning, below the $24.50 support level as a lack of fresh buying affected the market. The Silver-to-Gold ratio has moved back over the 80-to-1 number.
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