Precious metals march higher with new ATH for gold, steady gains for silver and platinum – FX Empire’s Zernov

Precious metals are seeing a strong rally following sector-supportive measures from China, with gold setting fresh all-time highs while silver and platinum continue to build on their recent strength, according to analyst Vladimir Zernov at FX Empire.

Gold was back in uncharted territory on Tuesday after China’s central bank cut its lending rates while also lowering its reserve requirement ratio for commercial banks in an effort to boost the country’s flagging economy.

“In case gold manages to settle above the $2650 level, it will head towards $2700,” Zernov projected, but warned that “RSI is in the overbought territory, so the risks of a pullback are increasing.”

Spot gold continued to march higher throughout the afternoon, last trading at $2,659.47 per ounce for a gain of 1.17% after establishing a new all-time high of $2,661.28 just before 3:30 pm EDT.

Turning to silver, Zernov noted that the gray metal was also challenging the upper band of resistance, with traders betting that China’s latest round of stimulus measures will boost its industrial demand.

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“If silver settles above the resistance at $31.45 – $31.75, it will move towards the next resistance level, which is located in the $34.00 – $34.25 range,” he said.

Silver prices have also maintained their strength on Tuesday, with spot silver Holding above $32 and last trading at $32.189 per ounce for a gain of nearly 5% on the daily chart.

Platinum has also gained ground amid the broad-based rally in precious metals markets and is also benefiting from the expectation that China’s stimulus measures will propel industrial demand for the metal.

“A successful test of the resistance at $975 – $985 will open the way to the test of the next resistance level at $1020 – $1030,” Zernov said.

Platinum prices climbed steadily on Tuesday with virtually no pullbacks, last trading at $987.26 for a 3.07% gain on the session.

Kitco Media

Ernest Hoffman

Time to Buy Gold and Silver

Tim Moseley

All roads lead to gold and prices above $3,000 – Sprott Inc’s Ryan McIntyre

While markets were pricing in the Federal Reserve’s 50-basis-point rate cut last week, many economists expected a less aggressive approach. However, according to one fund manager, the U.S. central bank, with its new easing cycle, has sent a strong message to investors.

In an interview with Kitco News last week, Ryan McIntyre, Managing Partner at Sprott Inc., said that Powell is walking a very narrow tightrope between supporting U.S. economic activity and managing elevated asset prices.

Although Federal Reserve Chair Jerome Powell has signaled that the central bank is in no major hurry to lower interest rates, McIntyre said investors should pay more attention to the Fed's actions than Powell's words.

“Clearly, with its 50-basis-point cut, the Fed doesn’t want to be seen as being behind the curve,” he said.

McIntyre added that bigger issues are at play than just the Federal Reserve’s monetary policy. He expects the central bank to continue focusing on supporting the economy, even if inflation remains stubbornly elevated.

“U.S. sovereign debt remains the biggest existential threat to the economy. The last thing the Federal Reserve wants is a recession, because that would really blow out the deficit,” he said. “This is the perfect environment for gold, as the Fed’s bias is clearly to the downside. Gold remains the simplest asset to own to protect your wealth and capital.”

Although the Federal Reserve has launched an impressive initial salvo in support of economic activity, McIntyre said he expects it's only a matter of time before investors move into gold to diversify their portfolios.

Even with the Fed’s new easing cycle, McIntyre said he expects the economy to worsen before it gets better. He pointed out that it will take time for the economy to feel the effects of this new easing cycle. He also noted that even with this 50-basis-point move, interest rates are still significantly restrictive.

“There are extreme asset valuations in many different categories, and I think gold is a logical alternative. Even with the rate cut, the economy is not out of the woods yet. I guarantee there are going to be things that happen that we are not talking about today,” he said.

McIntyre reiterated that sovereign debt remains the biggest threat to the global economy.

“If you look at financial markets at the sovereign level, because of high levels of debt worldwide, gold is the only alternative because it is the only asset seen as a global currency.”

McIntyre noted that the U.S. is in a precarious position as the government is expected to spend more than $1 trillion just to service its debt. He added that the threat to the economy arises as the ratio of service payments to GDP surpasses growth forecasts.

According to the Federal Reserve’s updated economic projections, U.S. GDP is expected to grow by 2% for the next three years. Service payments as a percentage of GDP are expected to rise to 3.1% this year, according to estimates from the Congressional Budget Office.

“We aren’t able to grow our way out of this fiscal position, and that is why all roads lead to gold,” said McIntyre. “Eventually, a vast majority of investors will find their way to gold. And gold will absolutely go through $3,000 an ounce; it’s only a matter of time."

Kitco Media

Neils Christensen

Time to Buy Gold and Silver

Tim Moseley

Gold sees mild profit-taking after tame U.S. CPI

Gold prices are near steady in midday U.S. trading Wednesday after selling off a bit right after the release of a tame U.S. inflation report. Profit taking from the shorter-term futures traders was featured. Silver prices are higher. December gold was last up $1.00 at $2,544.10 and December silver was up $0.316 at $28.935.

The U.S. data point of the week is Wednesday’s consumer price index for August, which came in at up 2.5% annually, compared to forecasts for up 2.6%, year-on-year, and follows the 2.9% rise seen in the July report. The “core” CPI (excluding food and energy) for August was up 3.2% annually, right in line with forecasts, and compares to a rise of 3.2% in the July report. The U.S. producer price index report is out Thursday.

It’s likely some of the selling pressure in gold after the CPI report was a “buy the rumor, sell the fact” scenario, whereby shorter-term futures traders expected a tame CPI report and established long positions beforehand, and then took profits after the tame CPI print.

U.S. stock indexes are solidly lower today. Some analysts are saying the weaker U.S. stock indexes are due in part to perceptions U.S. Vice President Kamala Harris beat former President Donald Trump in their debate Tuesday night.

The key outside markets today see the U.S. dollar index slightly up. Nymex crude oil prices are firmer on some short covering after hitting a 16-month low Tuesday, trading around $67.00 a barrel. The benchmark 10-year U.S. Treasury note yield is on the decline and is presently fetching 3.631%.

Technically, December gold bulls have the solid overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at the record high of $2,570.40. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,475.00. First resistance is seen at $2,550.00 and then at today’s high of $2,558.00. First support is seen at this week’s low of $2,514.20 and then at the September low of $2,502.70. Wyckoff's Market Rating: 8.0.

December silver futures bulls and bears are on a level overall near-term technical playing field. Silver bulls' next upside price objective is closing prices above solid technical resistance at $30.00. The next downside price objective for the bears is closing prices below solid support at the August low of $26.885. First resistance is seen at the overnight high of $29.215 and then at $29.55. Next support is seen at Tuesday’s low of $28.36 and then at $28.00. Wyckoff's Market Rating: 5.0.

Kitco Media

Jim Wyckoff

Time to Buy Gold and Silver

Tim Moseley

Gold Price News: Gold on Hold

Gold traded down at the end of last week faced with a somewhat firmer dollar and a US August Non-Farm Payroll print that combined both weaker than expected hiring and firmer wages. Rates markets have concluded that this might not only give the Fed pause for thought but that this would also be a policy error. While expectations of total Fed easing until the end of the year have fallen from c. 125bp to c. 115bp, they have also increased from c 240bps to c. 280bps by June 2025. This is ultimately bullish for gold but weakens short-term fundamental support. Gold starts this week trading at $2491/toz.

KAU/USD 1-hourly Kinesis Money

The CFTC Commitments of Traders (CoT) report published late on Friday saw gold speculators only slightly trim their net long gold futures positions over the week from the 52-month high seen at the end of August. However, data from physical gold ETFs/ETCs suggests that the first week of September saw net outflows, with European funds leading withdrawals. Friday also saw the People’s Bank of China (PBoC) reporting unchanged reserves at the end of August, implying a fourth straight month of zero net purchases. Overall, the gold flow and positioning picture seems rather less bullish – perhaps inevitable given elevated prices.

Technically, gold’s inability last week to successfully challenge descending minor oblique and major horizontal resistance confirms the overall picture of consolidation seen since 19 August and foreshadowed by unfavorable MACD and RSI indicators. Today these resistance levels appear at $2520/toz (descending minor oblique) and $2525/toz (major horizontal).

To the downside, the rising 20-day Simple Moving Average appears to have provided support, and this currently lies at $2498/toz. However, this seems very vulnerable given its proximity and poor underlying momentum. More dependable support is seen at $2490/toz being the confluence of major ascending oblique support and the 23.61% Fibonacci Retracement of the 25 July – 20 August uptrend.

It’s a relatively slow start to the events calendar this week, although August China inflation today and European Commission Summer Economic Forecasts on 10 September should be of interest to gold investors.

Time to Buy Gold and Silver

Tim Moseley

Gold Price News: Gold Eyes US Employment Data

Currently trading at $2519/toz, gold has enjoyed a modest bounce amidst febrile investor risk appetite, a continued easing of rates markets and further weakening of the US dollar. Initial indications are that net flows into physical ETFs/ETCs have held up well thus far this week. However, these flows can be highly volatile and are only loosely correlated to futures positioning, the latter of which will be updated after today’s European close.

All eyes now turn towards the slew of US August employment data released later today. This is arguably the single most significant data point ahead of the Fed’s rate decision 18 September. After the market havoc wreaked by the previous month’s weak print and historic revisions, expectations are for a 160k rise in Non-Farm Payrolls for August.

Gold’s most recent price action has seen it move back above the 23.61% Fibonacci retracement of the 25 July- 20 August uptrend at $2490/toz, ascending oblique major support at $2493/toz and a steeply ascending 20-day Simple Moving Average at $2494/toz. An immediate breakdown seems to have been avoided.

However, while gold now appears to have breached weak descending oblique resistance at $2517/toz, some caution should be exercised. Momentum indicators remain weak, and we need to see a sustained move above major horizontal resistance at $2520/toz before we can be confident of a positive resolution to a broader consolidation. Should that occur, there is weak ascending oblique resistance at $2538/toz and an initial breakout target of $2543/toz.

If the current tentative proximate support from Fibonacci, oblique support and moving averages be decisively compromised at $2493/toz, then the next major support levels present as the converging ascending lower bound of a 26 June/17 July/26 July channel and the rising 50-day Simple Moving average, both currently around $2439/toz.

Significant events for gold investors going forward include US August Employment data and speeches from Fed Board Member Waller and New York Fed President Williams – both FOMC voters and centrists – all on 6 September.

Mike Ingram

Time to Buy Gold and Silver

Tim Moseley

Gold shines as stocks and cryptos slide, traders bet on 4 rate cuts in 2024

Volatility extended for another day on Thursday, wiping the crypto gains recorded on Wednesday from the books and treating stock traders to whipsaws and afternoon downturns while gold shined bright.

“Yesterday’s sharp 4% rally to $58,500 proved short-lived as Bitcoin (BTC) quickly retraced to $56,400,” noted analysts at Secure Digital Markets. “Despite persistent selling pressure, the $56,000 level held firm as support.”

BTC/USD Chart by TradingView

“Realized volatility appears to be decreasing, and the spread between 30-day options at-the-money implied volatility is narrowing,” they added. “Historically, this suggests a significant price movement could occur within the next two to three weeks.”

At the time of writing, Bitcoin trades at $56,058, a decrease of 3.48% on the 24-hour chart.

Following Wednesday’s normalization of the two- and 10-year Treasury yield curve, Thursday’s jobs report – with private employers in the US posting their smallest monthly hiring growth since January 2021 – further stoked fears that the Fed waited too long to cut interest rates and has pushed the economy to the brink of recession.

As a result, the Kalshi prediction market shows traders “are now pricing in 4 rate cuts in 2024, or 100 bps of cuts, for the first time since the August 5th crash,” analysts at The Kobeissi Letter reported.

“Over the last 2 days, prediction markets have priced in an additional rate cut in 2024,” they said. “This comes as labor market data has deteriorated around the board. It's clear that unemployment data is quickly becoming the primary driver of Fed policy, along with inflation. Tomorrow's jobs report is huge.”

“Tomorrow's jobs report will be the key factor in determining if a 50 bps rate cut is coming this month,” the analysts said. “If the jobs report is in-line with expectations, or better, we believe a 25 bps rate cut is coming. Interest rate expectations appear to be shifting too dovish again.”

According to John Fath, managing partner at BTG Pactual Asset Management US LLC, “The Fed may need to act sooner, possibly with a 50 basis-point cut. If they do, the yield curve should fully disinvert.

Analysts at Secure Digital Markets noted that “Interest rate swaps indicate that traders have fully priced in a 25 basis-point cut at the upcoming Fed meeting, with a 30% chance of a more substantial half-point reduction. Overall, markets are expecting 110 basis points of rate cuts across the three remaining policy meetings this year.”

And X user David Sommers noted that while the 2m10y yield curve has turned positive, it would take at least six rate cuts to get the 3m10y yield curve back to neutral.

For now, all eyes are on Friday’s August jobs report, which will be one of the last bits of major economic news for the market and Fed to digest before the FOMC meeting on Sept. 18.

“This market is sort of showing restless qualities in the sense that it can't really figure out if good news is good news or bad news is bad news, and we continue to search for direction on all of this macro data,” Liz Young Thomas, head of investment strategy at SoFi, told Yahoo Finance. “I think if tomorrow's data comes in cool or soft compared to expectations, there will be a negative reaction in the market and likely further selling in a lot of those mega-cap names that have led us up to this point.”

At the close of markets, the S&P and Dow finished in the red, down 0.30% and 0.54%, respectively, while the Nasdaq gained 0.25%.

And while stocks and cryptos trended lower, gold returned to its winning ways, with spot gold up 0.84% at the time of writing and trading at $2,516.20 per ounce.

Bitcoin bulls could soon push higher

According to TradingView analyst TradingShot, Bitcoin has been under intense bearish pressure since early last week, but history suggests that it could soon restart its uptrend higher.

“Bitcoin may be under a quite strong short-term correction since the August 27 rejection on the 1D MA200 (orange trend-line), but based on this 2-year Cyclical Chart, it has high chances of finding Support again and starting a rally similar to the two it had over this time span,” TradingShot said in an update on Thursday.

“Let's start with the long-term outlook, which remained bullish after BTC hit and rebounded (August 06) on the 1W MA50 (red trend-line), its long-term Support since March 13, 2023,” he said. “The formation of the 1D Death Cross may have offset some of this optimism, but on this cyclical pattern, it is not a bearish sign as last time it emerged (September 11, 2023), Bitcoin formed its new bottom at the time.”

“In fact, it was inside a short-term (dotted) Channel Up, the vessel pattern, which took the price from the bottom to a new +100% rally,” he added. “The key parameter was the fact that the 1D MA200 broke and later was retested and held as Support. This is most likely why we are having the recent pull-back – because even though the price broke above the 1D MA200, it failed to hold.”
 

TradingShot noted that “The 1D RSI also prints a similar pattern to the previous two bottom fractals on this chart, and it appears that relative to those past sequences, we are currently after the first RSI peak and pull-back. On the price action, we illustrate the relative position of now and then with circles.”

“The Sine Waves [are] perhaps the most efficient depiction of the price cyclicality, clearly displaying where Bitcoin should be bought and where sold,” he concluded. “At the moment, we are just past the most optimal Buy Entry, so the opportunity still exists but may not last for long! Another +100% rise from August's recent bottom will see Bitcoin test the psychological benchmark of 100k.”

In the near term, MN Trading founder Michaël van de Poppe highlighted $56,000 and $58,200 as the support and resistance levels to watch for indications on whether the next move for Bitcoin will be a breakout higher or a breakdown lower.

Time to Buy Gold and Silver

Tim Moseley

Gold Price News: Gold Runs Out of Steam

While gold has largely been in consolidation mode since 19 August, price action this week is starting to suggest a retracement with the metal now trading at c. $2486/toz. This has come against a fundamental backdrop that has little changed over recent days with a slight easing of US rates and some firming of the US dollar, creating very little net impact for non-yielding dollar-denominated assets such as gold and silver.

gold price kau on kinesis exchange

Kinesis gold (KAU) price – $/g – on Kinesis Exchange

Consequently, it seems more likely that gold’s current weakness is a function of both recent performance – up 2.3% in August amid broader market turmoil – and an absence of further clear catalysts prompting profit-taking. Certainly, multiple geopolitical flashpoints remain, but timing remains a known unknown. So, are we seeing ‘stale bulls’ remove support?

The question is pertinent. We noted on Monday that the most recent CFTC Commitments of Traders (CoT) report saw speculative gold futures net longs at a 52-month high. It certainly remains to be seen how resilient this elevated level of speculative interest remains during this period of neutral fundamental support and recent depressed price momentum

Technically, gold is currently testing both the 20-day Simple Moving Average and the 23.61% Fibonacci retracement of the 25 July- 20 August uptrend at $2490/toz. Given that the standard MACD line pushed below the signal line on Monday and has descended further since, there is a reasonable probability of a further downside break. Should this occur, then the next likely levels of support are at the 38.3% Fibonacci retracement level of $2464/toz and descending oblique major support at $2445/toz.

To the upside, we see ascending major oblique resistance at $2510/toz and major horizontal resistance at $2513/toz. The initial breakout target of $2543/toz remains.

Significant events for gold investors going forward include the Bank of Canada rate decision (with high probability of a 0.25% cut) on 4 September and August US ISM Servies PMI on 5 September.

Time to Buy Gold and Silver

Tim Moseley