Weekly Market Report | 23/07/2023

Precious metals end mixed, with the focus turning to the Federal Open Market Committee (FOMC). Increased volatility is anticipated.

Indications only | Closing prices are bids | Prices & Charts  : Trading View | Market Research Refinitiv | See disclaimer below

Summary

Gold had a low-key start in Asia and Europe on Monday, trading between $1951 and $1959. Momentum increased after the New York opening, with the price slumping to a low of $1946 following comments by Janet Yellen, who mentioned she did not anticipate the US entering a recession. However, gold stabilized, ending the session unchanged at $1955. In contrast, silver shed some of its previous week’s gains, closing down by 0.44% at $24.84. Platinum rose slightly by 0.51% to $982, and palladium added 1.18% to finish at $1283.

On Tuesday, gold opened in Asia at its low for the day, $1955, and then rallied to reach $1972 in Europe. It fell back to $1960 before the New York opening. The US presented weaker than expected data on retail sales, industrial production, and capacity utilization. This resulted in a sharp rally to $1984, the highest level since June, amidst heavy trading. By the close, gold was up 1.23% at $1979. Silver extended its rally by 0.89% to $25.06; platinum increased by 0.71% to $989, and palladium climbed 2.42% to $1314.

The trend on Wednesday saw gold decreasing slightly from $1979 in Asia to $1972 due to light selling. A recovery followed, resulting in a morning benchmark of $1978.15, hinting at Central Bank buying. However, it receded to $1970 in early New York trading. The session ended with gold down by 0.1% at $1977; silver rose 0.36% to $25.15, platinum dropped 1.11% to $989, and palladium decreased 0.84% to $1303.

On Thursday, gold achieved a 2-month peak of $1987 in early Asia trading. However, sustained selling pressure through the day saw it drop to $1966 in New York. This decline was attributed to the US dollar rallying and the recovery of US Treasury yields. Gold closed 0.35% down at $1970. Industrial precious metals saw profit-taking, with silver down 1.55% at $24.76, platinum falling 1.74% to $961, and palladium declining 2.23% to $1274.

Friday’s session began with gold’s high at $1973 in early Asian trading, which then dropped to $1962 before stabilizing in Europe. It recovered to $1968 before the New York opening. However, a rally in the US dollar and a firmer tone in US Treasury yields weakened gold, pushing it down to $1958. By the close, gold was down 0.41% for the day but up 0.36% for the week at $1962. Silver continued its decline, dropping by 0.61% to end at $24.61, showing a 1.36% loss for the week. Platinum and palladium closed at $967 and $1286, respectively.

In the coming days, the US economy will be under the spotlight, with major reports being released, the most notable being the GDP data on Thursday. However, the crucial event is the FOMC meeting beginning on Tuesday and concluding on Wednesday. It will end with the Federal Reserve’s interest rate decision and a subsequent press conference. While recent benign inflation data has bolstered gold, the Federal Reserve is anticipated to raise the US base rate by 0.25%. Comments from Powell after the decision will be keenly observed for insights into the US Central Bank’s monetary policy. Predictions for the week include a volatile trading range for gold from $1990 to $1940. Silver is likely to push towards a resistance at $26, while platinum’s resistance is set at $1000. Palladium is predicted to see a rally, targeting the 100-day moving average at $1400.

Gold Chart ($/oz)

Silver Chart ($/oz)

Platinum Chart ($/oz)

Palladium Chart ($/oz)

This document is issued by Value Trading BV. While all reasonable care has been taken in preparing this document; no responsibility or liability is accepted for errors of fact or for any opinion expressed herein. Opinions, projections and estimates are subject to change without notice. This document is for information purposes only and for private circulation. It does not constitute any offer, recommendation or solicitation to any person to enter into transaction or adopt any hedging, trading or investment strategy, nor does it constitute any prediction of likely future movements in rates or prices or any representation that any such future movements will not exceed those shown in any illustration.