Gold Technical Report: Gold prices moved up yesterday for second straight session after a big decline last week and closed above 10 days Exponential Moving Average @ 1962. The prices earlier kept climbing above July High levels breaking the 2000 mark but shying away from 2010 consistently. The technical pullback last month was strong enough to cross above 50 days, 100 days and also 200 days Exponential Moving Average in a single day. On the reverse, the 10 days EMA has also crossed 200 days and 50 days EMA signifying strength. Gold had been on decline throughout earlier but started the rally with a gap up. Prices had reached at 7 moths low and received a much awaited relief. The short term Stochastics Oscillator is at 44 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 54 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices also moved up parallely and posted a solid green candle as prices crossed and crossed above all 10,50,100 and 200 days Exponential Moving Average in a single day. It is trying hard to hit the Oct month highs near 23.70 but finds hard to keep above 23.00 mark due to consistent selling pressure. The Short term Stochastics Oscillator is at 55 and Relative Strength Index near 51.
Fundamental Report: Inflation vis-à-vis the CPI (Consumer Price Index) came in unchanged when compared to the previous month. This provides the Federal Reserve with more data that could slow the oncoming of further rate hikes. The CPI increased 3.2% year-over-year; however, the inflation report came in under expectations of Wall Street projections. The core CPI (excludes food and energy prices) rose only 0.2% which was also well under projections and expectations by analysts polled which were anticipating a rise of 0.3%. This is the smallest increase in this inflation index since September 2021. One of the main factors was a decline of 2.5% in energy prices. However, the cost of food did increase by 0.3%. According to the CME’s FedWatch tool, the probability of a rate hike pause at the December FOMC meeting has moved substantially higher up to 99.8%, this number has increased from a likelihood of 69.6% one month ago, and 85.5% yesterday. Going ahead, the macroeconomic environment could turn favorable for gold. With the U.S. monetary tightening cycle nearing its end and the dollar potentially reaching its peak, we may see a moderation in U.S. 10-year yields and the dollar’s strength. This shift could bolster gold’s investment appeal, offering a ray of hope for its recovery in the near term.