Gold Technical Report: The Gold price brief recaptured the key short-term descending 21-Daily Moving Average (DMA) at $1,878 but failed to yield a daily closing above the latter.
The 14-day Relative Strength Index (RSI) indicator is lying just below the midline, suggesting that the upside attempts appear temporary in gold price. Failure to seek a weekly close above the 21 DMA at $1,878 could reinforce bearish interest, fuelling a fresh downswing toward Wednesday’s low of $1,859. The next relevant support is seen at the $1,850 psychological level.
On the upside, recapturing the 21 DMA barrier on a sustained basis will confirm a bullish reversal. Gold buyers will then target the $1,900 threshold. At that level, the mildly bearish 50 DMA coincides. Further up, powerful resistance around the $1,925 level could be challenged, where the 100 and 200 DMAs hang around.
Silver Technical Report:
Silver faced headwinds, slipping below the $22 mark and recording a decline of over 0.85% on Thursday. This downtrend is attributed to the bolstering US dollar, propelled by stronger CPI figures. In the context of a 4-hour chart, the metal’s pivot point is established at $21.50.
Ascending, immediate resistance for Silver is seen at $22.25, followed by $22.50 and a steeper climb to $22.90. On the flip side, support levels are laid down starting from $21.75, with added cushions at $21.58 and $21.15.
Concluding, the overall trend for Silver appears bearish, especially under the $22.25 mark, corresponding to the 50% Fibonacci retracement level. Simultaneously, Silver’s positioning below the 50 EMA fortifies the bearish view. In forthcoming sessions, market observers might anticipate Silver’s movements around these defined resistance points.
Fundamental Report:Investors reassess renewed hawkish US Federal Reserve (Fed) expectations, spurred by the unexpectedly hot Consumer Price Index (CPI) data from the United States. The US CPI increased 0.4% last month after a 0.3% gain in August, the Labor Department said on Thursday. On an annual basis, the CPI inflation steadied at 3.7% in September, at the same pace as seen in August while beating estimates of a 3.6% rise.
The US inflation data reinforced the Fed’s “higher rates for longer” narrative, lifting the US Dollar and the US Treasury bond yields from their recent two-week troughs. The probability of a rate hike in December from the Fed spiked up to 38%, according to the CME Fedwatch tool, compared with about a 28% chance seen before the report. Currently, markets price a 30% chance of a final Fed rate hike in December.
The reaction to the US CPI report was short-lived, as the US Dollar sellers have returned on Friday, even though risk sentiment remains sour after softer-than-expected Chinese CPI and Producer Price Index (PPI) data.
China’s Consumer Price Index (CPI) stagnated at 0% YoY in September after accelerating by 0.1% in August. The market expected an increase of 0.2%. China’s Producer Price Index (PPI) dropped 2.5% YoY in September, compared with a 3.0% decline registered previously. The market forecast was for a 2.4% decline.
Attention now turns toward the US Preliminary UoM Consumer Sentiment and Inflation Expectations data for fresh cues on the Fed’s interest rate outlook. Speeches from Fed policymakers will also play a pivotal role in influencing the US Dollar valuations alongside the end-of-the-week flows.