Gold Heads for Worst Week since November

Cassie Bastien

3/3/2017 10:19:25 AM

Daily Gold & Silver Market Report – 03/03/2017

With a U.S. interest rate hike set for mid-March, the chances of a Gold rally soon are slim. "With [U.S. Federal Reserve] President Janet Yellen on the wires tonight, we look to see further weakness across the precious complex should she, as expected, promote the potential for an interest rate increase in March," MKS PAMP Group trader Sam Laughlin said. According to Reuters technical Analyst Wang Tao, “Spot Gold may temporarily hover above a support at $1,232 per ounce and then bounce towards a resistance at $1,241 before falling again.” Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong doesn’t see Gold dropping below $1,220 per ounce, “unless the dollar is moving really high as we still see several uncertainties in the first half of the year."

• Spot Gold dropped 0.3 percent to $1,231.31 per ounce at 0730 GMT, after hitting a low of $1,229.05 earlier in the session.
• ABN Amro lifted its year-end 2017 Gold price forecast by $200 to $1,300 Thursday, while Commerzbank said any setbacks to prices should be limited and short-lived due to uncertainty over Trump's policies and European elections (Reuters).

Shocked by the Drop in Silver?

After proving to be one of the most sought after Precious Metals, Silver prices dipped Friday causing what Seeking Alpha reporter Nikhil Gupta calls a “steep cut of 3.8 percent.” However, many are questioning if the gray metal was on a “record gaining spree for the past nine weeks,” was this decrease so unexpected? Gupta actually feels this fall was required. Although the recent dip in prices could cause some investors to worry, Gupta says that “Silver is simply cooling down after a record winning spree…”

• The daily SLV price chart below tells us SLV is trading at $16.80.
• The 14-day Relative Strength Index value has dropped from north of 70 to 48.82, signaling that bears are in the driver’s seat for now.

U.S. Stocks Hit New Records

Investors’ pessimism is soaring since the still-fresh presidential election of Donald Trump in November. CNBC reporter Sam Meredith said, “The weekly [American Association of Individual Investors (AAII)] survey of U.S. investors found that they expect stock prices to fall over the next six months with AAII's bearish indicator rising by over 3 points to 35.6 percent.” Many onlookers have held Trump’s policy pledges responsible for recent market rallies. The Gloom, Boom & Doom Report Editor Mark Faber, often referred to as "Dr. Doom," said “market expectations for the Trump administration, U.S. economy, and foreign currencies, could all contribute to a reversal in fortunes.” Nevertheless, Berkshire Hathaway's Warren Buffett said Saturday in his closely watched annual letter that the "miraculous" boom in the U.S. economy is set to continue.

• The Dow Jones industrial average climbed to over 21,000 points on Wednesday for the first time in its history.

At 11:20 a.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,231.50 Down $3.60
• Silver, $17.84 Up $0.03
• Platinum, $991.80 Up $0.90
• Palladium, $760.60 Down $10.70

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