Gold Technical Report: Gold prices yesterday remained rangebound and posted a red Doji on the daily charts. It made an intra day high near 100 days Exponential moving average @ 1939 but could not cross over. The primary trend support is near 200 days EMA @ 1877. If prices move above 1984 last 3 months TrendLine resistance, it will open room for further advancement upto the major psychological level of 2000 and above. The short term Stochastics Oscillator is at 8 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 44 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices declined for third straight session as it retraced back from 50 days Exponential moving average @ 23.92 and then closed below 100 days EMA @ 23.64 for fisrt time in the last 15 trading sessions. Last month it has moved up with strength during the double bottom formation on daily charts, giving 2 consecutive massive upmoves as it also crossed a major psychological level of 25.00 on closing basis, for silver after almost 2 months of struggle. The Primary Trend support is near 200 EMA @ 22.69 below which it will turn bearish. The Short term Stochastics Oscillator is at 5 and Relative Strength Index near 42.
Fundamental Report: As investors anxiously await U.S. nonfarm payrolls data, strong dollar and rising bond yields pressure gold into deep correction territory. With U.S. gold futures also settling slightly lower, Thursday proved to be a day of caution. The U.S. dollar took center stage, leaping to a four-week high. This upswing made gold more expensive for those dealing in other currencies. At the same time, yields on U.S. 10-year Treasury bonds scaled their highest point since last November. A stronger dollar and heightened bond yields put pressure on gold. Recent economic data has stirred up the markets, leading to a heightened focus on U.S. jobs numbers. Notably, data showed a stronger-than-expected increase in U.S. private payrolls for July, an encouraging sign of continued labor market resilience. With this background, the Federal Reserve’s policy stance could hinge on the forthcoming U.S. jobs report. However, the upward tick in the number of Americans filing for unemployment benefits adds a wrinkle to the narrative. The Fitch downgrade of the United States of its triple A rating, saying successive standoffs over the nation’s debt ceiling and rapidly ballooning federal debt have cast doubt on the U.S to meet all its payment obligations added the woes. The historic downgrade, moves the federal government’s rating as a currency issuer from AAA to AA+. A lower credit rating could make borrowers less likely to lend money to the federal government on favourable terms, which in return will drive up costs for U.S taxpayers. Last month’s FOMC meeting statements and comments by Chairman Powell left many investors, analysts, and economists with more questions than answers regarding the future guidance as it pertains to the monetary policy of the Federal Reserve, it is widely believed that next month’s FOMC meeting will not contain another rate hike. The most current information provided by the CME’s Fedwatch tool predicts that there is an 82.5% probability that rates will remain unchanged after the Fed raised rates by ¼% at the last FOMC meeting.