Gold Technical Report: Gold prices retraced after recording an intraday high of the last 25 weeks a day before. The yellow metal is still respecting the support at 200 DMA at 1782. The rally may continue as it strides the important psychological 1800 mark and this weekly close will be important on charts, for being the final trading week of the year amidst the thin trading due to the festive season. The Medium term support stands at 50 DMA @1743 below which the trend may turn bearish. The short-term Stochastics Oscillator is at 48 and the Relative Strength Index is at 57.
Silver Technical Report: The silver prices, parallel with gold prices came down yesterday. The medium-term trend looks up as the prices continue to trade above 200 DMA @21.11. As 50 DMA @21.66 has crossed above 200 DMA on daily charts, further fire-up in the rally is expected. However, some technical profit booking can be expected here if the crossover fails. The Short term Stochastics Oscillator is at 50 and the RSI momentum is near 58.
Fundamental Report: The 10-year US Treasury yield rose on Wednesday, lifting the dollar, as investors fretted over economic growth and monetary policy direction for 2023. Gold prices closed lower on Wednesday after a tight trade inside its one-month range. After reaching its highest level since June the previous session, gold retreated as a stronger dollar and higher Treasury yields weighed. The SPDR Gold Shares ETF (GLD) finished at $167.91, down $0.76 or -0.45%. The 10-year U.S. Treasury yield rose on Wednesday, lifting the U.S. Dollar, as investors fretted over economic growth and monetary policy direction for 2023. The benchmark 10-year Treasury yield was up by more than 1 basis point at 3.875%. The yield on the 2-year Treasury note dipped by 1 basis point and was the last trading around 4.353%. Higher yields tend to weigh on non-yielding gold, while a stronger greenback makes dollar-denominated bullion more expensive for foreign traders. If the global economy suffers a serious hit in 2023, money may move back into the safe-haven U.S. dollar, which will be bearish for gold. It remains to be seen whether traders are ready to increase purchases of gold as a safe-haven asset. In 2022, safe-haven demand for gold existed in February and March, when traders focused on geopolitical tensions. Later, the combination of a stronger dollar and rising yields put significant pressure on gold and other precious metals, and traders were not ready to use them as safe-haven assets. From a big-picture point of view, gold managed to get out of the strong downside channel and is trying to develop sustainable upside momentum. If the Fed is not too hawkish, gold should have a good chance to move toward the $2000 level in 2023.