Gold Technical Report: Gold posted a robust performance last week and continues the rally this week. It has strong support at 20 DMA in 1824. The rally continues strongly after it has overcome the important psychological 1800 mark. The Medium term support stands at 200 DMA @1777 below which the trend may turn bearish. The short-term Stochastics Oscillator is at 89 and Relative Strength Index is at 68.
Silver Technical Report: The silver prices, are looking a bit tired after a smart performance last week. The medium-term trend looks up as the prices continue to trade above 50 DMA @22.38. As 50 DMA has crossed above 200 DMA @21.06 on daily charts, gives an indication of Buy on Dip. The Short term Stochastics Oscillator is at 42 and the RSI momentum is near 55.
Fundamental Report: Gold is trading at its highest value this year, although traders appear a bit cautious. Market participants will look at the December reading of the CPI (Consumer Price Index) this Thursday to gain more insight into the Federal Reserve’s 2023 monetary policy. The World Bank has unveiled its global economic prospects report yesterday. The international financial institution has already expressed concerns about the global economic outlook, warning of recession risk in 2023. Should the forecasts point to a global economic slowdown, another wave of risk aversion could sweep across markets as investors rush to safety. “Global growth is slowing sharply in the face of elevated inflation, higher interest rates, reduced investment, and disruptions caused by Russia’s invasion of Ukraine, according to the World Bank’s latest Global Economic Prospects report. Given fragile economic conditions, any new adverse development—such as higher-than-expected inflation, abrupt rises in interest rates to contain it, a resurgence of the COVID-19 pandemic, or escalating geopolitical tensions—could push the global economy into recession. This would mark the first time in more than 80 years that two global recessions have occurred within the same decade. The global economy is projected to grow by 1.7% in 2023 and 2.7% in 2024. The sharp downturn in growth is expected to be widespread, with forecasts in 2023 revised down for 95% of advanced economies and nearly 70% of emerging market and developing economies.”