GOLD SPOT PRICES RUN INTO RESISTANCE

Cassie Bastien

1/18/2017 10:08:00 AM

Daily Gold & Silver Market Report – 01/18/2017

Spot Gold prices hit resistance near $1,220 per ounce and drifted lower Wednesday as the U.S. dollar regained ground. The recently weak dollar was important in boosting Precious Metal prices, especially as U.S. bond yields also edged lower. With a slight decline in the January New York Empire State manufacturing index, Tim Clayton with EconomicCalendar.com said New York Federal Reserve President William Dudley “remained confident in the economic outlook, but also stated that inflation was not a problem, especially as the strong dollar will restrain import prices, which reinforced expectations of only a very slow pace of interest rate increases.” One of the most dovish members of the Federal Open Market Committee, Fed Governor Lael Brainard, said the economy is currently much closer to balance. Clayton noted, “The dollar remained mainly on the defensive, but Gold dipped to test support near $1,210 [per ounce] before finding support. … [Wednesday’s] comments from Fed Chair [Janet] Yellen could also have a significant market impact with political developments also important. Gold will tend to gain additional support if there are fresh fears surrounding trade protectionism.”

SILVER PRICES TRADE AT FIVE-WEEK HIGHS

As investors remained skittish amid Brexit plans and Donald Trump’s inauguration Friday, gray metal prices held their ground Wednesday. Silver spiked more than 2 percent Tuesday, hitting a five-week high after British Prime Minister Theresa May outlined a clear plan for exiting the European Union. EconomicCalendar.com reporter Sam Bourgi said, “An overextended equities market has supplied Precious Metals with more room for upside, as investors remain cautious ahead of President-elect Donald Trump’s inauguration on Friday. … Some analysts argue that [Trump-caused stock] rally may be in jeopardy on Friday should Trump’s inauguration speech fail to provide clear policy objectives.” The U.S. dollar rose after a large drop Tuesday that was partly inspired by Trump’s comments the currency was “too strong”. Bourgi said, “The dollar index rose 0.4 percent to 100.75. The dollar has been one of the main benefactors of the November 8 election result.”

STOCK FUTURES EDGE HIGHER AS INVESTORS AWAIT YELLEN SPEECH

Stock futures pointed to a marginally higher open Wednesday as investors digested earnings reports from Goldman Sachs Group and Citigroup Inc. Investors are also awaiting an important report on inflation as well as a speech from Federal Reserve Chairwoman Janet Yellen. R.W. Baird & Co. Equity Sales Trader Mike Antonelli believes global stocks will remain placid until investors better understand the fourth-quarter, corporate-earnings environment. He said, “We’re just coasting off of 2016 right now. With the lack of wind in our sails we’ve slowed down a bit.” Market research firm U.S. Investors Intelligence said its consumer-sentiment gauge, which relies on interviews with market newsletter writers, had reached an 18-month high. Antonelli said, “It’s hard for the market to go higher when everybody is already bullish.” MarketWatch reporters Joseph Adinolfi and Barbara Kollmeyer said, “U.S. stocks retreated Tuesday as the market turned its attention to comments from President-elect Donald Trump, who said a strong dollar is harming the U.S. economy. … Trump also criticized the North Atlantic Treaty Organization and warned that the U.S.’s one-China policy, a diplomatic protocol that has been in place since the 1970s, could be up for negotiation.” His comments took a toll on the dollar, which is still recovering.

At 11:08 A.M. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,217.40 Up $1.90
• Silver, $17.36 Up $0.16
• Platinum, $973.60 Down $8.50
• Palladium, $753.90 Down $0.10

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