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Rajan Dhall

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(Kitco News) -Precious metal starts the week on mixed as gold trades flat but silver pushed 1.11% higher at the Asian close leading into the EU open. Last week gold had a stellar week rising just under 6% and leading into the US election there could be more volatility ahead.

One of the main narratives leading into the week is the US fiscal stimulus saga. The Trump administration were said to have called on Congress to try and approve a watered-down coronavirus relief bill using leftover funds from an expired small business loan program as negotiations on a broader package ran into resistance.

The general risk sentiment in Asia was positive at the start of the week as only the Nikkei 225 (0.30%) traded under flat. Australia’s ASX (0.49%) and China’s Shanghai Composite (2.45%) traded well with the Chinese bourses still catching up from public holidays last week.

There is not too much going on in the FX markets. Just some mild Japanese yen strength. Only Kiwi dollar has outshone the JPY as EUR/NZD trades 0.30% lower and GBP/NZD is the worst performing pair trading 0.35% in the red.

In terms of main events on Monday, traders will be looking out for comments from ECB President Lagarde, de Guindos and BoE Governor Bailey. The data slate is very light at the start of the week.

Author: Rajan Dhall

Source: Kitco: Silver outperforms gold leading into the European market open

(Kitco News) – Gold is pushing higher once again as hopes for fiscal stimulus continue to spur stock markets. The US dollar is once again weaker but most notably against the EUR. Gold has moved 0.25% higher leading into the US stock market open and is looking to test a key level. The market is yet to decide if this is just a deep retracement or a reversal but a move back into the previous consolidation area is a good sign for the bulls.

The chart shows that the old consolidation support is now being tested again as a resistance zone. If the price does close above the area then the mean value point could be the target. This would be around $1936 per ounce and was the point in which the price had the most touches during the sideways move. Above this, the green horizontal line represents the $2K psychological level. If this is taken out then the yellow metal might kick on to test the current all-time high at $2075.14 per ounce.

Later in the session, the market will hear from Fed Chair Powell. The recent comments at the Jackson Hole symposium have changed the landscape of monetary policy as the new average inflation target could exceed the previous of 2%.

Elsewhere, the markets seem to be taking Biden leading in the polls as a positive. Analysts are noting the fact that a Democrat win could lead to more stimulus and stocks have rallied. For the rest of the session watch out for the close as a move above the downward sloping trendline and resistance at $1917.12 per ounce could be a good sign for the bulls.

Author: Rajan Dhall

Source: Kitco: Gold is holding at a key technical resistance level

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