Gold Technical Report: Gold posted a robust performance last week and continues the rally this week. It has strong support at 10 DMA in 1874. The rally continues strongly after it has overcome the important psychological 1900 mark and nears another @2000. The Medium term support stands at 200 DMA @1779 below which the trend may turn bearish. The short-term Stochastics Oscillator is at 89 and Relative Strength Index is at 74.
Silver Technical Report: The silver prices, parallel with the gold prices registered a robust performance in the latter part of the week. The medium-term trend looks up as the prices continue to trade above 50 DMA @22.65. As 50 DMA has crossed above 200 DMA @21.08 on daily charts, gives an indication of Buy on Dip. The Short term Stochastics Oscillator is at 82 and the RSI momentum is near 61.
Fundamental Report: In his first public appearance of 2023, US Federal Reserve Chair Jerome Powell participated in a panel discussion (Central bank independence and the mandate – evolving views) on Tuesday and reiterated the central bank’s commitment to contain inflation. Powell added that ‘restoring price stability when inflation is high can require measures that are not popular in the short term as we raise interest rates to slow the economy’. However, comments on upcoming policies were minimal. The main highlight for the week, though, was US inflation. Consumer prices, as expected, eased for a 6th consecutive month in the 12 months to December (2022) to 6.5%, according to the US Bureau of Labour Statistics (BLS). This follows the peak set in June 2022 at 9.1%. US core annual inflation, excluding energy and food, eased to 5.7% in the 12 months to December, softening by 0.3 percentage points from November’s 6.0% reading.
This led to a bid across risk assets as market participants anticipate a slowdown in the pace of policy tightening out of the US Federal Reserve (Fed). According to the CME’s FedWatch Tool, based on Fed Fund futures contract prices, the market has all but priced in a 25 basis-point increase for the next Fed meeting on 1 February, an action that would lift the Federal Funds target range to 4.50%-4.75%.
NO Important Data Today: US Bank Holiday (Martin Luther King Jr. Day )