Commentary for Friday, Oct 18, 2024 (www.golddealer.com) – Today gold closed up $22.70 at $2713.70, and silver closed up $1.46 at $33.03. Safe haven demand has pushed gold to record highs, which will increase bullish sentiment and ramp up buzz. But what I find fascinating about this latest move to the high ground is the increasing number of traders who believe that even higher numbers are in the making before the holidays. And that new records will be made in 2025. I can’t remember a time when virtually everyone was on the same bullish page. Some like Ronnie Stoeferle are even predicting $4800.00 gold by 2030. That’s a bit too bullish for us but let’s enjoy the ride and be happy that restrictions on gold ownership have not troubled this amazing ride. Also worth noting is that gold is higher by $100.00 this month so I expect a bit of turbulence during all this happiness. Enjoy your weekend. Last Friday gold closed at $2657.60 / silver at $31.52. On the week gold was higher by $56.10, and silver was higher by $1.51.
Please note that FedEx is no longer asking for delivery signatures. They are scanning IDs. We have complained to FedEx, but they remain resolute. Scanned identification is safer, but if you have a problem with this decision, please make your feelings known to FedEx. Unfortunately, the present delivery time for the USPS alternative is 2-3 weeks.
Should you decide to use our Delayed Delivery Program please talk with your service rep and understand how this program works. It is handy if you want to lock in the price “now” and insist on a new product – but is not for everyone. Just like us – you must pay upfront to “lock in” prices and you can’t “change” your mind. So, unless God has blessed you with patience, please ask your rep for other options and thank you for understanding.
On Monday gold traded between $2666.00 and $2646.00, drifting lower, reacting to a stronger dollar and continued settling as investors take profits. This must be disappointing to bullish sentiment after we saw a significant jump in prices this past Friday (+ $37.00). So, my theory about hidden overhead resistance above $2700.00 remains in place. This paradox will not last because there are plenty of bulls trying to decide their next bet. But for now, it does show caution which is a good sign for this still developing bullish leg to higher ground. Patience during this transition will prove rewarding, for both buyer and seller, especially in the longer term.
Reuters (Anushree Ashish Mukherjee) – Gold edges lower as US dollar rally curbs upside – “Gold prices eased on Monday as broad economic stimulus measures in China, the biggest bullion consumer, failed to invoke investor confidence and a U.S. dollar rally to two-month highs capped upside momentum. Spot gold fell 0.2% to $2,651.00 per ounce by 10:09 a.m. ET (1409 GMT), having hit its highest in over a week earlier in the session. U.S. gold futures eased 0.3% to$2,668.00. The dollar rose to its highest since mid-August as investors digested China’s weekend stimulus announcements, while the euro extended its fall ahead of a central bank meeting this week. Phillip Streible, chief market strategist at Blue Line Futures, said there were “a lot of little headwinds for gold,” including the China stimulus, stronger dollar, weaker Euro, weaker base metals, and profit-taking. Gold’s record price rally in the last few months has dampened investor sentiment and bullion demand in China. A stronger dollar makes gold more expensive for other currency holders. Chinese data is double-edged. Weak Chinese data could reduce demand for gold, but a broader slowdown in China could unsettle markets, enhancing gold’s appeal as a safe haven, Zain Vawda, market analyst at MarketPulse by OANDA, said. “Overall, there are still more factors supporting higher gold prices than those weighing against it,” Vawda said. Investors will also monitor comments from Fed officials this week for more hints on the upcoming rate cuts, along with U.S. retail sales data. Traders see a roughly 84% chance of the Fed cutting rates by 25 basis points at its November meeting. Lower interest rates reduce the opportunity cost of holding bullion. Spot silver fell 0.7% to $31.30 per ounce, while platinum rose 1% to $994.40. Palladium dropped over 3% to $1,034.50.”
On the day gold closed down $9.80 at $2647.80, and silver closed down $0.32 $31.20.
On Tuesday gold opened unchanged, trading between $2640.00 and $2670.00 as this market looked for fresh information. Our shiny friend then pushed higher finishing the day nicely in the green. So, the price of gold is not stalling. But a small red flag, if there is one, would be that gold has not been able to move above $2700.00 even as world tension supports safe haven demand. And some insiders even see new record prices before the holiday season.
I’m less optimistic because this assessment assumes that the Fed will remain dovish. And interest rates will continue to move lower. What’s the plan if inflation remains “sticky” and the Fed decides to keep its options open? This reasoning suggests that “record highs” may have to wait until next year when the Fed will have less options and be forced to lower rates. Also of note is this latest headline by the IMF (International Monetary Fund) Global public debt even ‘worse than it looks,’ could reach 115% of GDP in 3 years. It is too early to consider $3000.00 at this point but given the current driving forces including unfunded debt wordwide, I’m optimistic.
Reuters (Rahul Paswan) – Gold stalls as buoyant US dollar keeps gains in check – “Gold prices held steady on Tuesday as the U.S. dollar remained near two-month highs, with markets caught between profit-taking and prospects for further rate cuts by the Federal Reserve. Spot gold was steady at $2,652.72 per ounce at 1108 GMT while U.S. gold futures nudged up 0.1% to $2,669.20. “We’ve got a U.S. dollar near two-month highs, higher Treasury yields and also the overwhelming temptation of profit taking as we go towards November after gold’s nearly 30% gain so far this year, so in short gold’s got some pretty fierce headwinds at the moment,” independent analyst Ross Norman said. Gold prices hit a record high of $2,685.42 last month, but shed some of those gains as the dollar (.DXY), opens new tab hovered near a more than two-month peak reached in the previous session, making bullion more expensive for other currency holders. “Further rate cuts I think will continue to support gold and we’ll probably see a fresh all-time high this side of the year end,” Norman said. Currently traders see about an 87% chance of a 25-basis-point cut in November, according to the CME FedWatch tool. Non-yielding gold thrives in a lower interest rate environment. Fed Governor Christopher Waller called for “more caution” on rate cuts ahead but Fed Bank of Minneapolis President Neel Kashkari said more rate reductions are likely as the Fed’s 2% inflation target looms in sight. Market participants are also watching out for U.S. retail sales, industrial production data and weekly jobless claims this week. Spot silver eased 0.1% to $31.14 per ounce. Platinum fell 1.2% to $980.78 and palladium was down 1.8% at $1,011.77. “Scrap supply (for platinum) has disappointed in recent years, but we see room for a recovery next year. We still expect the platinum market to be under-supplied in 2025,” UBS analysts said in a note.”
On the day gold closed up $13.20 at $2661.00, and silver closed up $0.33 at $31.53.
On Wednesday the price of gold moved between $2666.00 and $2684.00, but this initial rally cooled which is a bit troubling, but it would still appear bullish winds continue to drive prices higher. Increased political tension, bullish charts and increased buzz suggest new record prices may be in the cards sooner than later. Still, even if the bulls show strength above $2700.00 the bears will be waiting in line to take advantage if investors cash in and prices weaken. But the larger picture looks like gold is ready for $3000.00 next year. That being said, even with today’s higher prices the public is not in a hurry to sell gold or silver bullion across our trading desk.
FXEmpire (Christopher Lewis) – Gold Market Continues to Look For a Break Higher – “The gold market continues to see a lot of upward pressure, as the market is trying to break to a fresh, new, high. At this point, the market is one that you have to be looking at dips as value, and an opportunity to get long again. Technical Analysis – The gold market rallied again during the early hours on Wednesday as we continue to see gold really take the market by the reins. All things being equal, we are on the precipice of a breakout currently, and I do think that the market is going to continue to look at buyers jumping into the market on short-term dips as it offers a little bit of value. The $2,600 level underneath is a major support level with the 50-day EMA reaching that area rather soon from what I can see. In general, this is a market that continues to be very noisy but ultimately, I do think that based on the measured move, we could get to the $2,800 level based on a bullish flag. All things being equal, this is a market that I think continues to be driven by geopolitical concerns as well as the idea of interest rates dropping. With central banks around the world cutting rates the way they will be, it’s going to obviously have a major influence on gold and where it goes. With this being the case, I think you have to understand this is a scenario where between geopolitics and interest rates, I do think it’s probably only a matter of time before gold probably goes reaching all the way to the $2,800 level and then eventually the $3,000 level. I have absolutely no interest whatsoever in trying to get short of this market. It’s certainly way too strong to think about that. Silver Continues to Look Strong on Wednesday – The silver market was bullish during the early hours of Wednesday, as the market continues to look to the $32.50 level as a target, as well as a barrier. This is a market that will continue to be very noisy, and dangerous to say the least. Technical Analysis – The silver market rallied just a bit during the early hours on Wednesday as it looks like we are going to continue to try to drive higher, perhaps looking to the $32.50 level. The $32.50 level, of course, is an area that has been significant resistance a couple of times already. So, I do think that there’s a lot of interest in it. If we can break above the $32.50 level on a daily close, then I think you’ve got a real shot at the market taking off to the upside and perhaps trying to get to the $35 level over the longer term. All things being equal, a short-term pullback at this point in time makes quite a bit of sense because that gives you more value and therefore people will jump in and try to take advantage of cheap ounces. The 50-day EMA sits right around the $30.50 level. Below there we have the $30 level, which of course is a large round psychological figure and an area that we’ve seen a lot of noise at previously. Keep in mind that silver will move based on interest rates dropping and of course the US dollar falling. There are also some effects when it comes to geopolitics because when they get a little less stable, then precious metals do okay. It’s also worth noting that silver is also an industrial metal, so it does have that component as well to a lesser point, which causes some noise.”
On the day gold closed up $12.60 at $2673.60, and silver closed up $0.23 at $31.76.
On Thursday the price of gold again moved higher ($2695.00) as expectations of interest rate cuts and jitters over the election increase bullish sentiment. This gold bull continues to gather strength, encouraged by a positive technical picture and geopolitical tension. Most bigger players are betting on $3000.00 gold in 2025, given that interest rates continue lower and the FOMC remains dovish. That being said, consider the possibility that record high prices now and into next year will increase physical gold sales. This will not cause this gold bull to retreat, there are too many other factors supporting these prices. But it might just slow the momentum down, making gold look more stable in this crazy world and attracting fresh US investors.
For those of you who think this rally is just getting started, there are others who will agree with you 100%, like (Ernest Hoffman) (Kitco) – Ronnie Stoeferle, Managing Partner at Incrementum believes this rally isn’t over: Five reasons why gold prices will keep rising, and will hit $4,800 by 2030. I don’t know about that, 2030 is only 5 years away but my guess would be that something above $3000.00 is not much of a stretch. So, keep your powder dry and enjoy the ride.
Reuters (Rahul Paswan) – Gold hits record high as US rate cut bets and election jitters spur demand – “Gold prices charged to an all-time high on Thursday, as expectations of more interest rate cuts by the U.S. Federal Reserve and uncertainty over the U.S. presidential election boosted demand for bullion. Spot gold rose 0.5% to $2,686.46 per ounce by 1126 GMT, after hitting a record high of $2,688.82 earlier in the day. U.S. gold futures gained 0.4% to $2,702.20. “With the U.S. election less than three weeks away, market caution is likely to remain a key theme. Given the tight race between Donald Trump and Kamala Harris, this adds another layer of uncertainty – stimulating demand for safe haven assets,” said FXTM senior research analyst Lukman Otunuga. Gold has risen over 30% so far this year in a record-breaking rally driven by expectations that the Fed will cut rates further after a jumbo reduction in September, along with ongoing geopolitical uncertainties. The European Central Bank is also expected to make its first back-to-back rate cut in 13 years later in the day. Lower interest rates and geopolitical tensions support bullion, which yields no interest and is considered a safe asset. “The LBMA poll that came out from Miami earlier in the week, where the base look for gold prices was to rally near $3,000 in the next year and silver doing even better, I think that potential is also just attracting a bit of attention,” said Ole Hansen, head of commodity strategy at Saxo Bank. Gold prices are expected to rise to $2,941 a troy ounce over the next 12 months, delegates to the London Bullion Market Association’s annual gathering predicted earlier this week. Meanwhile, traders are on the lookout for U.S. retail sales and weekly jobless claims data due later in the day. “A set of disappointing U.S. data may fuel bets around Fed rate cuts,” Otunuga said. Spot silver rose 0.6% to $31.85 per ounce. Platinum gained 1.2% to $1,004.75 and palladium rose 1.1% to $1,034.25.”
On the day gold closed up $17.40 at $2691.00, and silver closed down $0.19 at $31.57.
On Friday gold not only broke to record highs it did so with a bit of fireworks which might suggest that momentum will continue to help the bulls next week. Gold reached $2719.00 before settling somewhat, finishing the day nicely in the green. Our phones are not ringing off the hook, but it is interesting that the buying and selling action is pretty much even. There has been a significant drop in the amount of cash that investors used this week to buy gold and silver bullion. Not sure what to make of that, but it limits our cash on hand to selling investors. We can always pay with a wire but if you must have cash talk with Brandon and we will do our best to service your needs. This leads into a funny kind of banking dynamic. Did you know that asking a bank for cash is not easy? And banks have a service charge if we deposit cash into our own account? I used to discount the talk that the banking system is moving America towards a “cashless” society. But the handwriting may already be on the wall.
Reuters (Daksh Grover and Swati Verma) – Gold breaks $2,700 barrier for first time on safe haven demand – “Gold raced past the $2,700 mark for the first time on Friday, extending a rally driven by expectations of further monetary policy easing and safe-haven demand due to uncertainty about the U.S. presidential elections and Middle East conflicts. Spot gold rose 0.6% to $2,709.81 per ounce by 1145 GMT, having hit an all-time high of $2,714.00 earlier in the session. Bullion has gained over 2% so far this week. U.S. gold futures gained 0.7% to $2,725. “The markets continue to look to geopolitics and the overnight developments in the Middle East continue to fan the flames of uncertainty,” said StoneX analyst Rhona O’Connell. Lebanon’s Hezbollah militant group said on Friday it was moving to a new and escalating phase in its war against Israel, while Israel’s Prime Minister Benjamin Netanyahu late on Thursday vowed to press on with wars in Lebanon and Gaza. Rising geopolitical tensions prompt investors to seek safe-haven assets like gold, driven by risk aversion and concerns over global market instability. “There’s no surprise that gold broke fresh highs and the psychologically important $2,700 during Asian hours as it appears speculative interest is coming from that region,” analyst Ross Norman said. “Gold is benefiting from some very high conviction trades and not only is ignoring key factors like inflation declining and Treasury yields, but it is scarcely pausing for consolidation – let alone profit taking.” Gold has surged more than 31% this year, with gains driven by the anticipation of more easing by major central banks including the U.S. Federal Reserve and geopolitical tensions. In the physical markets, dealers in India were forced to offer discounts this week, as record high prices dampened demand ahead of a key festival. “On a technical basis, should gold continue to push higher, it may encounter resistance at around $2,750 an ounce, which is the upper boundary of a rising trend channel that we’ve seen since late July,” said Frank Watson, market analyst at Kinesis Money. Spot silver rose 1.2% to $32.08 and headed for a weekly gain. Platinum added 1.5% to $1,007.25 and palladium increased 1.5% to $1,057.82.
On the day gold closed up $22.70 at $2713.70, and silver closed up $1.46 at $33.03.
Platinum closed up $18.10 at $1015.10, and palladium closed up $39.40 at $1077.70.
Jim Wycoff (Kitco) – “Technically, December gold bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $2,800.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $2,650.00. First resistance is seen at $2,750.00 and then at $2,775.00. First support is seen at the overnight low of $2,707.30 and then at $2,700.00. December silver futures bulls have the firm overall near-term technical advantage. Prices are in a nine-week-old uptrend on the daily bar chart. Silver bulls’ next upside price objective is closing prices above technical resistance at the May high of $33.50. The next downside price objective for the bears is closing prices below support at the October low of $30.345. First resistance is seen at $32.50 and then at $33.00. Next support is at $32.00 and then at $31.50.”
Brothers and Sisters, thank you for your friendship. If you have unusual circumstances, need cash or a special favor – talk to Harry or Eric or Ken Slater. We are now back to our traditional business model. Thank you for your patience. Blessings. Richard Schwary
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