Gold Technical Report: Gold prices had started giving bullish hints in the latter part of last week amidst the thin trading due to the festive season and have continued the bullish mood so far. It has already recorded an intraday high in the last 6 months and has strong support at 200 DMA at 1779. The rally continues strongly after it has overcome the important psychological 1800 mark. The Medium term support stands at 50 DMA @1758 below which the trend may turn bearish. The short-term Stochastics Oscillator is at 80 and the Relative Strength Index is at 64.
Silver Technical Report: The silver prices, witnessed a technical correction yesterday, but it can be viewed more as a consolidation of the uptrend. The medium-term trend looks up as the prices continue to trade above 200 DMA @21.09. As 50 DMA @22.04 has crossed above 200 DMA on daily charts, further fire-up in the rally is expected. The Short term Stochastics Oscillator is at 32 and the RSI momentum is near 57.
Fundamental Report: Yesterday, the Federal Reserve released the minutes from last month’s FOMC meeting. Even though Fed remains in a Hawkish mood, Gold continues the 2023 rally. Unanimously Fed officials agreed that the central bank should slow the pace of its aggressive rate hikes. This would allow them to continue to ratchet up the cost of credit to curb inflation. They continue to be worried that market participants have an inaccurate perception of hoping for rate cuts this year. However, they left the door open to tightening even more aggressively if inflation rises. “Most participants emphasized the need to retain flexibility and optionality when moving policy to a more restrictive stance,”. Most importantly they continued their stern doctrine to raise interest rates to just over 5% by the end of this year. “No participants anticipated that it would be appropriate to begin reducing the federal funds rate target in 2023,”. Another important event draws closer which is Friday’s U.S. Non-Farm Payrolls report. Major economies such as the UK and Eurozone are believed to be already going through an economic contraction. The US – the world’s largest economy – is expected to experience a downturn later this year.