Gold Technical Report: Gold prices, continued the rally further after getting nice support on an intraday basis near 50 Day Moving Average (DMA) @1878. Since both 10 DMA @1864 and 50 DMA are trading over 200 DMA @1775, the medium-term trend looks upwards. The major support stands at 200 DMA below which the trend may turn bearish. The short-term Stochastics Oscillator is at 91 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 64 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: The silver prices also followed suit, moved up smartly, and crossed 100 DMA @22.16 but retraced back from 50 DMA @ 22.36. The medium-term trend looks bullish as both of them are trading above 200 DMA @ 20.89. The Short term Stochastics Oscillator is at 80 and Relative Strength Index is near 54.
Fundamental Report: As a rare phenomenon, multiple assets traded sharply higher including gold, the dollar, and U.S. Treasuries. These gains were directly attributed to another crisis in the banking sector. This caused market participants to lighten their riskier assets and move that capital into safe-haven assets. The current global rush into safe-haven assets began in Europe and then moved across the pond into Wall Street as news surfaced of a new bank failure this time in Europe. Shares of Credit Suisse initially dropped 31% and when the dust settled its stock shares had declined by 13.91%. This is because of a report of a potential plan to stabilize the bank from Swiss banking regulators. According to Bloomberg News, “Swiss authorities and Credit Suisse Group AG are discussing ways to stabilize the bank, according to people familiar with the matter, after comments by its biggest shareholder and broader financial market jitters helped trigger a plunge in the stock on Wednesday.” The article in Bloomberg stated that the first move to shore up confidence in the Credit Suisse bank is being led by Switzerland’s central bank and its financial regulator announced that Credit Suisse will receive a “liquidity backstop if needed”. Issues with Switzerland’s second-largest lender, Credit Suisse have been ripe with problems over the last several years due to a “series of blowups, scandal sips, leadership changes, and legal issues.” Last year Credit Suisse lost $7.9 billion which eroded the profits from the previous year. Over the last three months credit Suisse depositors have withdrawn over $100 billion in assets as concerns over the multiple issues cited above.