Market Updates
Keep up-to-date in the past week’s price action and the current geopolitical and economic factors driving the international and local precious metal markets.
S&P 500 down more than 4% overnight
U.S. stocks plunged the most in 6 1/2 years, with the Dow Jones Industrial Average sinking more than 1,100 points, and the S&P 500 down more than 4% overnight, amid rising concern that inflation will force interest rates higher. Treasuries rallied and gold rose on safe haven demand. The AUD suffered too, pushing spot gold in AUD back above $1,700 per ounce.
Precious Metals News Update - 6 February 2018
Hello everyone.
Violent moves were seen across the gamut of financial markets spanning stocks, interest rates, currencies and commodities, as the week commenced.
Yesterday’s Far Eastern session was one of the choppiest I can recall in recent memory.
Bitcoin Breaks as Sovereign Wealth Funds go for Gold
Gold and silver had a steady end to January 2018, closing out the month with an increase of 4% (gold) and 2% (silver) in USD terms. For local investors, returns were constrained, owing to a rally in the AUD, which closed the month comfortably above USD $0.80.
Other asset classes have hogged the headlines though, with equity markets rallying strongly, so much so that a now record number of Americans expect to see rising stock prices over the next 12 months. Whilst risk is flying higher, bonds, Bitcoin and the US dollar have all sold off violently to start the year.
Precious Metals News Update 25 January 2018
Hello everyone.
Gold and silver ripped higher on Thursday as the US Dollar was given the baby seal treatment by investors after US Treasury Secretary Steven Mnuchin commented at the World Economic Forum in Davos that; "Obviously a weaker dollar is good for us as it relates to trade and opportunities,” - thereby departing from the widely followed public script by US officials that a strong Greenback is always desirable.
The brakes were also slammed on the Dow Jones Index’s untrammelled ascent to record highs, after US Commerce Secretary Wilbur Ross commented at the WEF that China's 2025 Technology Plan was a "direct threat" to the US, sparking fears of an escalation in the (perceived) trade war being waged by the US presently, as well as fears of increased protectionism from the world’s largest economy. Fears exacerbated by the freshly announced US tariffs on solar panels and washing machines less than 24 hours prior.
Gold Powers Higher!
Gold prices have continued their march higher overnight, currently trading near USD $1355oz. Silver has also rallied, continuing the impressive run in precious metal prices which dates back to mid December, with gold and silver up 9% and 12% respectively in this current rally.
Australian dollar returns continue to be impacted by the strength in local currency, which continues to hold above USD $0.80, with gold and silver in AUD pushing up toward (but not yet reaching) $1700oz and $22oz respectively.
Precious Metals News Update 24 January 2018
Hello everyone,
The three day US government “shutdown” concluded prior to the commencement of Far Eastern trading yesterday, after the US Senate voted (81-18) to pass funding measures through until February 8th in exchange for a promise from Republican leaders to address the DACA (Deferred Action for Childhood Arrivals) issue.
Precious Metals News Update 22 January 2018
Hello everyone.
Precious metals closed out last week on a firm footing, most likely resulting from end-of-week booksquaring / profit-taking / shortcovering.
Over the weekend, headlines were dominated by news that the Democrats failure to extract concessions from President Trump’s Administration in relation to the granting of amnesty to illegal immigrants, had torpedoed the 60 Senate votes required to continue funding the “spending gap” of the US government, thereby leading to the closure of components of the US Government as of midnight Saturday.
Gold Rallies as Cryptos Crumble
It’s not yet three weeks old, but 2018 is already shaping up as an interesting year in financial markets. Stocks have flown out of the gate, and bond yields are rising, with Bill Gross claiming we’ve seen the end of the bull market in fixed income.
Bitcoin and cryptocurrencies have crashed hard, whilst precious metals have continued their solid move higher, which began in mid December 2017, with gold comfortably trading back above USD $1320oz, and silver closing in on USD $17oz.
Senior Trader Daily Update 18 January 2018
Good morning everyone.
The precious metals, having spent their time since mid-December shrugging off regular record highs in US equity markets and instead taking their cues from a backpedalling Greenback to advance strongly, were taken to with a 4x2 overnight in late trade in what was an extremely choppy day. HFT Algo’s piled in and hoovered up US dollars when news hit the wires of Apple’s intention to repatriate its offshore profits and consequently make an estimated USD 38 billion one-off tax payment (likely the largest of its kind). Additionally, the technology behemoth sketched out its plans to invest more than USD 30 billion to expand its US operations as a result of the recent tax cuts (including construction of a new US campus, data centres and the creation of more than 20,000 jobs, leading to a $350bn “direct contribution” to the American economy over the next five years).
Senior Trader Daily Update 19 December 2017
Hello everyone.
The progress of US President Trump’s (and the Republican party’s) tax reforms held sway over the markets and related uncertainty fed into a weak US Dollar Index throughout much of yesterday’s trade, allowing gold and silver to advance by the close of business in spite of buoyant US equities markets.
That was basically the long and short of it, as the saying goes.
Gold and Bitcoin: Podcast on the “Best Party in Finance”
Cryptocurrencies have been in the news again this week, with RBA governor Phillip Lowe describing Bitcoin as a speculative mania!
Following on from his detailed report titled “Bitcoin, Dollars, Gold: What is the Future of Money” – ABC Bullion Chief Economist Jordan Eliseo has been invited to discuss the topic in a number of forums, including a recent podcast hosted by Livewire Markets, one of the leading financial news sites in Australia.
Senior Trader Daily Update 14 December 2017
Hello everyone.
Gold and silver (in both USD and AUD terms) experienced what is commonly known as a “buy the rumour / sell the fact” rebound (or in this specific instance a “sell the rumour / buy the fact” bounce), as profit taking / shortcovering emerged when the US Federal Reserve confirmed a widely anticipated (and priced in) Fed Funds rate increase by announcing a 25 basis points hike at the conclusion of its FOMC monetary policy meeting. Additionally, guidance for next year suggested the likelihood of at least three more interest rate increases. The US central bank also signalled its intention to keep to its commitment to increase its monthly balance sheet runoff to $20b in Jan.
Senior Trader Daily Update 12 December 2017
Hello everyone,
The bad news for precious metals (and specifically gold investors) is that some major support levels have ceded over the past few sessions with “risk on” being the trade du jour, spurred on by robust economic progress from the world’s largest economy, the USA. If a picture says a thousand words, then the attached charts for the US Dollar Index (DXY), the Dow Jones Index and the phenomenon that is Bitcoin, speak volumes. So too does the latest Commitments of Traders data as at December 5th (see table below) which portrays significant levels of long liquidation across the complex but especially in gold and silver.
Senior Trader Daily Update 7 December 2017
Good morning everyone.
Mixed trade was seen in gold on Wednesday, while silver and platinum were pressured lower.
Gold slipped modestly after the release of the latest private U.S. ADP National Employment Report (Nov) which came in +190K and even though the all-important 200 Day moving average was penetrated, any sustained unravelling was prevented due to the US government funding and debt ceiling issue remaining unresolved.
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.
Senior Trader Daily Update 6 December 2017
Good morning everyone.
Gold traded to its lowest level since August 9th in USD terms as the markets remained confident that the US Tax Reform legislation presently making its way through both Houses of government, will be passed before year end. ‘Risk on’ investor sentiment was thereby stoked as the US Dollar was driven higher against its major pairs.
Senior Trader Daily Update 2 December 2017
Hello everyone,
Precious metals markets were ambling into the weekend on Friday until financial markets were thrown into late turmoil when a bottom-feeding ‘journalist’ from ABC News (US) ran a fraudulent story that former National Security Adviser in the Trump Administration, Lieutenant General Michael Flynn, would be testifying that then candidate Trump had ordered him to engage with Russian officials (thereby validating the “Russian Collusion” narrative), when in fact, Lieutenant General Flynn had been instructed to engage with Russian officials by President-elect Trump during the transition period as part of the normal (and legal) business of government.
The Dow Jones Industrial Average shed 390 points on the basis of the irresponsible falsehood as ABC News sat on a retraction for hours. XAU/USD rallied from 1271.50 to just short of 1290.00 before rolling over (and then gapping lower on this morning’s Far Eastern open). The US dollar was also crushed against all the major currencies on the back of the initial report.
This most recent example of (intentional) erroneous reporting underscores the agenda-driven approach and blind hatred of the US mainstream media towards President Trump and validates his placing the “Fake News media” directly in his crosshairs, as well as totally debasing any of their contributions.
Senior Trader Daily Update 1 December 2017
Good morning everyone.
Gold and silver continued their southern drift on Thursday, pressured lower by the Dow Jones Industrial Average registering a record high above 24,000 and a spike in US Treasury Yields due to the shortening of odds in favour of the Republican Tax Reform Bill succeeding. Also weighing, were hawkish monetary policy comments from outgoing US Federal Reserve Chairman, Janet Yellen on the back of the seemingly robust US economy.
Gold up 12% for the year. Aussie housing declines.
It’s been a mixed week for precious metals bulls, with the price of gold originally retesting the crucial USD $1,300oz mark, before pulling back to current levels around USD $1,285oz.
Silver has also suffered mixed fortunes, trading north of USD $17oz before an overnight pullback saw the metal fall to USD $16.50oz.
The proximate cause of last night’s pullback was a better than expected revision for Q3 GDP.
Senior Trader Daily Update 30 November 2017
Good morning everyone.
XAU/USD was driven back down into the middle of its well-established 1265 to 1295/1300 range on Wednesday, finding support between its 21 & 100 Day moving averages at 1282 - 1285. The trigger for the retreat was a revision to 3rd Quarter US GDP data which at 3.3%, came in marginally above market expectations and delivered the strongest GDP result in 3 years.
The late in the session news yesterday of a North Korean missile launch was effectively shrugged off by the markets with President Trump casually remarking “We’ll take care of it.”
Senior Trader Daily Update 29 November 2017
Good morning everyone.
Precious metals markets saw sideways, choppy, rangebound price action on Tuesday in spite of:
US equities continuing to scale record highs, fuelled by progress in the US Senate to advance the Republican tax bill.
Late reports of North Korea launching a missile 4.5 kms into the air which eventually fell into the Sea of Japan and which was claimed by the Pentagon to have been an ICBM.
Senior Trader Daily Update 21 November 2017
Good morning everyone.
Having posted strong gains on the back of Greenback weakness (particularly against the JPY) on Friday, news on Monday that a breakdown in negotiations between the various parties in Germany that were attempting to form a coalition government resulting from September’s election, saw the precious metals rally deflate quicker than the Hindenburg, as the EUR was kicked to the curb and investors were herded back to the safety of the US dollar.