Gold Technical Report: Yesterday, Gold prices remained in narrow range and registered a small Doji candle on daily charts. Gold has resumed last week’s rally confidently as the 10 days Exponential Moving Average @ 1958, last week crossed above 100 DMA @ 1937 and this week crossed above 50 days EMA @ 1951. If these levels sustain, it will open room for further advancement upto the major psychological level of 2000 and above. Main support level is near 200 days EMA @ 1874. The short term Stochastics Oscillator is at 92 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 65 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices moved up further gaining strength from the double bottom formation on daily charts. It had already hinted the potential strength while giving 2 consecutive massive upmoves last week as it had also crossed above both 50 and 100 days EMA with good volumes. It has now crossed main target 25.00 yesterday on closing basis, a major psychological level for silver after almost 2 months of struggle. The main support is near 200 days EMA @ 22.58. The Short term Stochastics Oscillator is at 95 and Relative Strength Index near 70.
Fundamental Report: The Gold reached a near nine-week high, driven by a weaker dollar and expectations that the U.S. Federal Reserve may pause its interest rate hikes. The declining dollar index, hovering close to a one-year low, made gold more affordable for holders of other currencies. Investors are anticipating a 25 basis points rate hike at the upcoming Fed meeting, maintaining rates within the 5.25%-5.5% range in 2023, according to CME’s FedWatch tool. While the possibility of a rate cut in 2023 seems unlikely, lower interest rates generally benefit gold as they reduce the opportunity cost of holding the non-yielding asset. The investors are also keeping an eye on the upcoming U.S. jobless claims data for the week of July 15. Forecasts suggest a rise to 242,000 from the previous 237,000 claims. The market has observed an increase in jobless claims over the second quarter, and a sideways movement is expected. If jobless claims remain flat or rise further, it could potentially drive a positive movement in gold prices. Earler this week, the monthly retail sales data disappointed, suggesting that the US consumer is not in as strong a position as was previously thought. Core retail sales came in at 0.2%, to the market’s expectation of 0.4%. The broader reading also came in at 0.2%, much lower than Wall Street’s anticipated 0.5% figure.What this pair of economic reports could suggest is that the Fed has finally made some headway in its battle against inflation, and that this headway has come at the cost of consumer strength, which was always an outcome to be expected.