Gold, Silver Prices Hold Ground Ahead of Inflation Data
2023.08.07 03:42
Last week was a very heavy week filled with all kinds of data:
- Fitch Downgrade
- Earnings: Amazon.com Inc (NASDAQ:) up Apple (NASDAQ:) down
- Jobs Report-Wages rising
- Treasury Yields higher-at October 2022 highs
- Record temperatures around the globe-including winter in S. America
- prices rise 6 weeks in a row
The metals are holding their ground. The first chart shows in contango.
That is when the futures price of a commodity is higher than the spot price.
Contango occurs when an asset’s price is expected to rise over time.
Gold spot futures closed right around $1957 per ounce.
The GLD (NYSE:) ETF chart shows it in a caution phase under the 50-DMA.
The leadership indicator shows GLD slightly outperforming the or benchmark. SPY closed down on the week from $456.92 down to $447, or about 2.2% lower.
Gold closed down from $181.86 to $180.20, or about 1.1% lower. Stronger than the SPY on a percentage basis.
GLD’s momentum on the Real Motion indicator turned up some, yet remains in a bearish divergence to price.
SPY’s momentum also fell and sits just below the 50-DMA (the first time it broke that momentum line since March), while the price is above that is a bearish divergence in momentum.
The point is that if SPY falters more from here and GLD rises, this will confirm the first indication of risk-off, something to watch for the coming week.
is still underperforming gold and is also in contango.
Silver Futures Daily Chart
Silver futures closed under the 50-daily moving average but over the 200-DMA. $23.50-24.00 gives us a good range to start from this week.
Above $24, and we would be encouraged to think silver has more upside. And in the case of the next chart:
We would think that iShares Silver Trust (NYSE:) could gain leadership against gold, which right now on the leadership indicator has it underperforming.
If this is the case, it would have a positive impact on both metals and could indicate an increase in inflation.
SLV, the ETF like the silver futures, closed under the 50-DMA and is in a warning phase.
The momentum indicator has silver waning in momentum, so the decision on the next price move for silver could be evident as quickly as this week.
ETF Summary
- (SPY) 450 pivotal 440 support at the 50-DMA
- Russell 2000 (IWM) 191 is the 23-month holy grail 193 July 6-month range hi
- Dow (DIA) 35,000 support
- Nasdaq (QQQ) 365-380 range
- Regional banks (KRE) Back over 48 looks ok and under 44 not so much
- Semiconductors (SMH) 161 now more in the rear view-150 in focus
- Transportation (IYT) July 6-month calendar range high at 259.30-closed below it-caution
- Biotechnology (IBB) Compression between 123-130
- Retail (XRT) 66-67.40 short-term range
