Gold Technical Report: Gold prices declined yesterday for fifth straight day and closed below the major averages. The prices slipped from the intra day high and cound not cross above the conjunction point of 50 days EMA and 100 days EMA near 1932. It further declined breaking the 10 days Exponential Moving Average @ 1924. Next support stands at 200 days EMA @ 1911 whereas resistance lies near 1951 Horizontal TrendLine touchpoint. The short term Stochastics Oscillator is at 52 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 46 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices continued the decline on sixth consecutive day as prices slipped from intraday high near 100 days EMA @ 23.62 and slipped further to close below 200 days EMA@ 23.24. The 10 days EMA and 50 days EMA are at conjuction point 23.7. Last week it made a the brief intraday high above the psychological mark of 25.00 but it could not hold ground and decline started. The Short term Stochastics Oscillator is at 24 and Relative Strength Index near 40.
Fundamental Report :Gold prices lingered near a one-week low, marking a downward trend across five consecutive sessions. This decline comes as the U.S. dollar achieves its highest since mid-March, buoyed by strong U.S. services sector data from August. The U.S. dollar’s strengthening comes on the back of the services sector data, suggesting persistent inflationary pressures. With the Federal Reserve taking a cautious stance, Boston Fed President Susan Collins emphasized a measured approach to future monetary policy adjustments. She recognizes the evident progress in moderating inflation, further highlighted by a Federal Reserve report showing modest economic growth and cooling inflationary pressures during July and August. China, a major gold consumer, is undergoing a pivotal economic shift. As the country transitions from an infrastructure and investment focus to a consumption-centric economy, challenges arise. Recent data underscored this, revealing an 8.8% YoY drop in China’s August exports and a 7.3% contraction in imports. Moreover, China’s service activity, despite stimulus efforts, recorded its slowest expansion in eight months. Gold’s investment appeal wanes during periods of rising U.S. interest rates due to the increased opportunity costs of holding the non-yielding asset. This sentiment was evident as the SPDR Gold Trust, the world’s premier gold-backed exchange-traded fund, reported a 0.36% decline in its holdings. The broader investment community, while expecting the Fed to maintain current rates at its upcoming meeting, is still factoring in a 42% likelihood of a rate increase before 2024.