Gold Technical Report: Gold prices slid further yesterday, for the straight third session and closed at the day low. The 10 days Exponential Moving Average @ 1912 is poised to cross below 200 days EMA @ 1909. Also, 50 days EMA @ 1938 and 100 EMA @ are at close conjunction. The prices will have to regain 1900 quickly now to display any strength. The short term Stochastics Oscillator is at 3 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 32 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices are on a continuous decline mode from the start of this month and yesterday further declined for the straight fourth session after intra day high above the 200 days EMA @ 22.70 rejected by the market and and closed at the day low . The 10 days EMA @ 22.83 had last week crossed below 100 days EMA @ 23.47 indicating bearishness. The prices need to stabilize at these levels which is also low we saw in June from where it moved all the way up to major psychological levels of 25.00. The Short term Stochastics Oscillator is at 10 and Relative Strength Index near 34.
Fundamental Report : The FED, yesterday released the minutes from the July FOMC meeting which indicated that most Federal Reserve officials still believe that high levels of inflation are an ongoing threat and merit additional interest rate hikes. However, there was not an overall unison regarding the path forward in what can be best described as mixed messages amongst Federal Reserve members. One of the primary takeaways was that members were divided over the question of further rate hikes. While most Fed officials were in favor of an increase in the terminal interest rate (Fed funds rate), some members believe that further hikes might take rates too high. The risks of raising rates too much versus too little had become more two-sided, and it was important that the committee’s decisions balance the risk of an inadvertent overtightening of policy against the cost of an insufficient tightening. Overall, there is a consensus that the Federal Reserve will not raise rates at the next FOMC meeting in September. At the same time, according to the CME’s FedWatch tool, there is a one in three chance that the Fed will implement one more 0.25% rate hike this year. Since interest rate hikes this year have resulted in bearish market sentiment taking gold lower, today’s minutes will most likely continue that trend.