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GOLD SPOT PRICE RISES TO EIGHT-WEEK HIGH

Daily Gold & Silver Market Report – 01/16/2017

Gold prices touched their highest level in about eight weeks Monday as analysts prepare for worries about both President-elect Donald Trump and Brexit. Trump’s comments in recent interviews touched on China, Russia, the European Union and more. Writer Victor Reklaitis with MarketWatch said Trump “suggested he would be open to lifting sanctions on Russia and wasn’t committed to a longstanding agreement with China over Taiwan. He [also] predicted more departures from the EU and reiterated his past criticism of NATO.” In the meantime, investors are preparing for U.K. Prime Minister Theresa May’s scheduled speech Tuesday, when she is expected to reveal her country’s plans to exit the European Union. Reklaitis reported Gold gained 1.9 percent last week, getting a boost from the dollar-and-stock retreat. Commerzbank analysts cited Commodity Futures Trading Commission data, noting, “Speculative financial investors have built up net long positions in [Gold] for the first time in nine weeks.”

SILVER’S DOWNTREND TO RESUME

Silver prices continue to navigate their bearish trend, which could signify another large slip for the gray metal. Conversely, Blackwell Global and Investing.com report, “There is also scope for a little more upside potential in the near-term which means the likely reversal is still a number of sessions away from materializing. … The well-tested bearish channel is quite clearly still in place and Silver is beginning to inch closer to the upside constraint.” A shift in sentiment back toward Gold and Silver suggests the structure cannot weather another breakout attempt. Fortunately, according to Blackwell Global, “the evidence still seems to suggest that even with its increased uptick in popularity, Silver spot prices should reverse relatively shortly.” The effects of the numerous interest rate increases expected in 2017 cannot be ignored. Also, Blackwell Global notes, “the [Federal Reserve’s] general rhetoric and stated opposition to [Donald] Trump’s inflationary policies should counteract much of the headline risks posed by a Trump presidency. Ultimately, these fundamental factors provide fertile ground for further slides in Silver prices, which could make the current downtrend a long one.” What does this mean for Silver in the near-term? Chances of an upside breakout are fairly low, leaving the Precious Metal with little choice but to go down.

INVESTORS ARE BRACING FOR A MASSIVE STOCK-MARKET SELLOFF

MarketWatch reporter Jospeph Adinolfi said “stocks are in for a wild ride in February. … Demand for one-month call options tied to the CBOE Volatility Index, a popular gauge of stock-market volatility, has spiked in the past week, a sign that some are bracing for a sharp downturn following the inauguration of President-elect Donald Trump.” According to Brian Bier, head of Sales and Trading at Macro Risk Advisors, “investors have purchased 250,000 VIX call options with a strike price at 21, and another 100,000 with the strike at 22,” believing that it would take a massive selloff to make these options even profitable. Adinolfi explains, “Investors frequently use VIX futures and options as a hedge against volatility. That way, if stocks tank, they can offset some of those losses with the profits from their options trades.” Despite increasing uncertainty regarding fiscal and monetary policy direction, stock-market volatility has been relatively passive so far in 2017. Bier added, Aside from the beginning of Trump’s first 100 days in office, … there are no clear market-moving catalysts.” Adinolfi  closed saying, “Stocks have struggled to build on their gains this week, and some Wall Street analysts are saying that the inauguration could mar near-term top.”

At 10:31 A.M. (ET), the APMEX Precious Metals spot prices were:

  • Gold, $1,206.40 Up $7.70
  • Silver, $16.92 Up $0.11
  • Platinum, $988.10 Up $2.70
  • Palladium, $752.90 Up $2.70

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.

GOLD PRICES UNDER CUT BY DOLLAR RECOVERY

Daily Gold & Silver Market Report – 01/13/2017

After hitting seven-week highs Thursday, a U.S. dollar recovery and firm tone in risk appetite undermined the potential for further gains in Gold prices with a retreat below $1,200 per ounce. Tim Clayton with EconomicCalendar.com said, “The dollar remained on the defensive early in the New York session with USD/JPY continuing to test support below the 114.00 level, while the trade-weighted index dipped to the lowest level for four weeks and below the level seen ahead of the December rate hike.” Although the latest Chinese trade data was worse than expected, Clayton reports, “there was no significant deterioration in risk appetite, which curbed potential Gold demand. … The US retail sales data will cause some short-term volatility, although the overall impact may be limited unless the data is substantially different from expectations. Gold will gain support if the data is notably weaker than expected, while very strong data would undermine precious metals.”

SILVER SPOT PRICE HAS NOT PEAKED

Peter Cooper with TheNational said Silver was his tip for 2016 with prices 15 percent year-on-year, “albeit well off its peak gains during the year of 50 percent.” Silver spot prices, which are typically leveraged on the price of Gold, should be spectacular, Cooper said. Like many others, Cooper was wrong thinking Gold would rally following Donald Trump’s election. However, some believe once his inauguration is over Jan. 20, financial markets may drop and Precious Metals could increase. A number of top analysts have several interest rates rises depressing the outlook for Gold and Silver. “But this may either not happen,” Cooper said, “or inflation could prove more rapid than expected and have the same effect. … Gold will always be the steady choice, but Silver is the natural outperformer when it comes to serious bull markets as we saw last year. Cooper added, “If you track the ratio of the price of Silver to Gold, you will find it fluctuates between an extreme of x80 and lows of x40. This ratio shrinks as a bull market accelerates and is just over 70 now,” making Silver a better buy.

OPEC CUTS

With sentiment worsened by concerns over the health of the Chinese economy after reporting its steepest export falls since 2009, oil prices are on track to end the week lower on lingering doubts over the extent of Organization of Petroleum Exporting Countries cuts. Traders said record Chinese crude imports of 8.56 million barrels per day in December helped buoy prices somewhat, but they couldn’t hide underlying fears over the overall health of the world's second-biggest economy. Ahmad Ghaddar with Reuters said, “Despite China's oil thirst, overall exports declined by 7.7 percent last year in what was the second annual decline in a row and the worst since the depths of the global crisis in 2009.” Hard evidence of export reductions has yet to arise two weeks into the month in which the cuts by OPEC and other producers, like Russia, were supposed to start. Ghaddar said many analysts expect compliance between 50 percent and 80 percent, at best. Stephen Brennock of oil brokerage PVM said, "As the Saudis hint at even deeper reductions in February, assumptions are rife that its enthusiastic approach to output cuts is an admission that cheating is expected on the part of other producers.” Even if OPEC cuts its output as discussed, traders believe rising U.S. shale output and increasing supply from OPEC members Nigeria and Libya, which were exempt from the pact, might offset any reductions.

At 11:40 A.M. (ET), the APMEX Precious Metals spot prices were:

  • Gold, $1,196.10 Down $6.20
  • Silver, $16.81 Down $0.05
  • Platinum, $983.70 Up $0.00
  • Palladium, $752.50 Down $13.80

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.

GOLD FUTURES TOP $1,200

Daily Gold & Silver Market Report – 01/12/2017

Gold rallied to a seven-week high Thursday after the U.S. dollar dropped in response to President-elect Donald Trump’s highly-anticipated press conference. Dollar weakness is typically beneficial to Gold spot prices, boosting the yellow metal's appeal as an alternative asset and making the dollar-priced commodity cheaper for holders of other currencies. Trump disappointed the dollar bulls after failing to detail his plans for deregulation, lower corporate taxes and fiscal stimulus. Despite a lack of economic policy outlines, Investing.com said “Trump has been credited with being a major catalyst behind the impressive rally since Election Day in the dollar and stocks.” According to Investing.com’s Fed Rate Monitor Tool, traders remain unconvinced of the Federal Reserve’s plan for three interest rate hikes in 2017 and instead are pricing only two this year. As traders look for more signs on the likelihood of higher interest rates, global financial markets turn their focus to several planned Fed speakers Thursday, including Chair Janet Yellen.

TRUMP’S PRESSER THREATENED TO WRECK HIS OWN STOCK-MARKET RALLY

President-elect Donald Trump’s first news conference Wednesday “didn’t deliver fresh insights into the billionaire’s policies, but it did manage to whipsaw Wall Street stocks,” Wallace Witkowski with MarketWatch reported. U.S. equities dropped after the news conference started, with comments that drug companies were “getting away with murder” with respect to pricing. Witkowski said, “Equities had traded higher on the promise clarity on Trump’s promise of delivering a shot in the arm to the U.S. economy, but with a dearth of details and a focus on railing against news outlets, stock investors struggled for a spark.” In emailed comments, Naeem Aslam, chief market analyst at ThinkMarkets, said, “The biggest impact on markets out of Trump news conference was on Biotech firms. … The reaction by investors was a pure panic and we have experienced many traders pressing the sell button.”

ANOTHER GLOBAL EQUITY BULL MARKET?

Investors are getting impatient as they await to hear Donald Trump’s plans to ‘make America great again’. MarketWatch Markets Reporter Barbara Kollmeyer said there is disappointment lingering after Trump’s press conference “with a bit of gloom across global stocks and the dollar.” Analysts at Westpac Bank complained that, “The news conference was a far cry from the market-friendly, pro-growth comments that Trump delivered at his acceptance speech on November 9.” Kollmeyer provided a chart that shows half of the world’s stock markets are now in a bull market, up more than 20 percent from a 52-week low. As Topdown Charts’ Callum Thomas notes, “once markets officially move from a bear to a bull market, they take off strongly at the start — as in 2003 and 2009. Hence today, stocks may have some way to run yet.”

At 10:49 A.M. (ET), the APMEX Precious Metals spot prices were:

  • Gold, $1,203.40Up $4.50
  • Silver, $16.93 Up $0.07
  • Platinum, $981.30 Up $5.90
  • Palladium, $761.90 Up $7.00

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help. - See more at: http://www.apmex.com/gold-and-silver-market-commentaries/3478/gold-price-uncertainty#sthash.xU5JLLGo.dpuf

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