Gold Technical Report: Gold prices remained static yesterday after a continued decline for five straight sessions as it came down heavily after crossing 100 days Exponential Moving Average @ 2004 and also the psychological mark of 2000, a day before. The recent swings are contained in the range recorded by extreme points when it crossed above 2100 mark upside on 4th Dec and also drifted down below 1980 on 12th Dec. The short term Stochastics Oscillator is at 10 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 37 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices bounced back against previous downfall when it came crashing from the highs near 50 days EMA and crossed below 10 days EMA before close. The recent upmoves were capped around 23.40 where all 50,100 and 200 days Exponential Moving Averages are clustering. The Short term Stochastics Oscillator is at 26 and Relative Strength Index near 46.
Fundamental Report: The Gold prices tumbled heavily day before yesterday as the inflation data finally took its toll on gold which, after holding strong above $2,000 this year, finally crumbled under the pressure of rates staying higher. Inflation in January was hotter than expected across the board. The headline and core monthly readings printed at 0.3% while the annual readings came in at 3.1% and 3.9%, respectively. While an improvement at the headline level, it’s less so than markets were positioned for and as a result, all but killed any hope of a first rate cut in March. Markets are now priced at 93% for a hold next month, quite the shift from a month ago. What’s more, only 75 basis points of rate cuts are now priced in this year; quite the drop from 175 at one point last month. It would appear traders now view the resilient economy will, in fact, come at quite a significant cost. Stronger than anticipated inflation figures confirmed the Federal Reserve´s stance of extending the waiting period before shifting to tighten the monetary policy through rate cuts.