Gold breaks below key moving average – plus the latest on Crypto!

The gold price broke below the key 200 day moving average this week, with the yellow metal currently trading just below USD $1,265oz. There is support at these levels, though a move down toward USD $1,250z can’t be ruled out.

Silver is also considerably weaker, having dropped below USD $16oz, down over 5% since the start of the week, with the gold to silver ratio (GSR) now approaching 79:1.

In Australian dollar terms, the yellow metal is currently sitting at AUD $1,674oz, still comfortably above its 200 day moving average, with a softer local currency supporting the precious metal market for investors.

On the physical demand side, we’ve seen continued inflows into the ETF space, with roughly 9 tonnes of metal being bought by these vehicles across the world.

For the year, nearly 200 tonnes of gold have been bought by ETFs, highlighting the continued support for the yellow metal we are seeing amongst Western investors, though the buying has been heavily concentrated in Europe.

There are a couple of key news events which could impact financial markets including gold in the next two days, including the GDP figures out of Europe as well as a speech from ECB President Draghi.

In the United States, market attention will be focused on US non-farm payrolls, as well as the still unresolved issues surrounding a US government ‘shutdown’, if President Trump and Congress can’t pass appropriate legislation in time.

A likely resolution to that impasse, as well as stronger than expected payrolls report (anything north of 200,000 jobs would be ‘beat’ relative to market expectations) would likely see a further pullback in gold, and crucial support around USD $1,250oz come into play, though what transpires remains to be seen.

Crypto Current Podcast

Earlier in the week, I was invited onto the Crypto Current Podcast, hosted by Alan Kohler over at the Constant Investor. As many of our readers would know, Alan is one of Australia’s leading finance commentators and journalists.

We discussed the ‘competition’ between gold and crypto, whether or not gold really is a safe haven, and a range of other issues in global financial markets today.

If you would like to access the podcast, which also featured Kay Van-Peterson, Global Macro and Crypto Strategist from Saxo Bank, then please click here.

At the top of the page – there will be an advertisement to sign up to a free 7-day pass to the Constant Investor. It will only take you a minute to sign up, which will then give you access to the podcast and a written transcript of what we discussed.

As always, we encourage you to share this report with family, friends and colleagues, and look forward to any questions or feedback you may have.
 
Warm regards,
Jordan Eliseo

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