Gold
Gold prices have started the week in demand with gold back in the green again last week’s rally. While prices are a little off last week’s highs for now, the near-term outlook remains geared towards further gains as equities markets come under pressure. Risk sentiment has taken a hit over the weekend as global omicron concerns ratcheted higher. In Europe, a number of countries have had to introduce fresh restrictions, including curfews and lockdowns in places, in a bid to tackle soaring omicron numbers. The UK is said to be mulling further measures also, with speculation that a Christmas lockdown might be needed. Meanwhile, in the US sentiment has been hit by news that Biden’s “Build Back Better” has been shelved for now following rejection by one of Biden’s top party officials.
Looking ahead this week, trading is likely to remain light in the lead up to the Christmas holidays. However, given the fluid situation around omicron, the risks of further restrictions being announced (including lockdowns) holds the potential to stoke market volatility at a moments notice. For now, with risk assets under pressure, gold prices are likely to retain a safe haven bid across the week.
Silver
Silver prices remain subdued near the foot of the declines seen across November and early December. With the US Dollar having moved higher, in line with soaring Fed tightening expectations, silver prices have been heavily pressured. The downturn in equities prices is now weighing on silver also as the prospect of a fresh wave of global restrictions in response to omicron threatens to weigh on demand for the metal.
Technical Views
Gold
Gold prices are now sitting just above the block of consolidation which formed atop the 1763.88 level. While price holds above there, and with the rising trend line and MACD and RSI supporting, the focus is on a further push higher in the near term. For bulls, 1826.71 is the next marker to note. To the downside, 1763.88 is the key support to note.
Silver
Following the breakdown through the rising channel from YTD lows, silver prices remain around the 21.4523-22.3205 level support for now. MACD has crossed bullish here, along with RSI rising, suggesting a potential correction higher in the offing. However, 24.0073 is likely to act as resistance to any such move, keeping the focus on further downside longer-term.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.