Gold
It’s been another positive weekly opening for gold prices. The safe haven asset has seen firm demand over the Asian session and into the European open on Monday as the decline in the US Dollar paves the way for higher prices.
Following a slew of better than expected data over recent weeks, USD bulls were left firmly disappointed last week as the latest labour market data drastically undershot expectations. The unemployment rate spiked back up to 6.1% in April, from the prior month’s 6%.
Meanwhile, the headline NFP figure printed just 266k on the month, against the prior month’s 916k and the expected 990k. While average hourly earnings saw a firm jump to 0.7% from the prior month’s -0.1%, the data as a whole saw USD selling intensify.
The focus this week will be on USD CPI due on Wednesday ahead of retail sales on Friday. USD is likely to remain weak into these releases, keeping gold supported, though this theme could reverse on any positive data surprises. Should these releases also disappoint, however, gold is likely to see a further boost from a weaker USD.
Silver
The silver market has been another key beneficiary of the decline in the US Dollar. With the greenback heading lower over recent weeks, silver has been able to reverse higher and break above several key levels. The continued really in equities markets has also been a big upside driver for silver prices. Last week, the latest round of UK and Eurozone manufacturing data reaffirmed the positive demand outlook for silver, suggesting that prices are likely to continue to rise over the near term as vaccine optimism and re-opening plans continue to help buoy the market.
Technical Views
GOLD
The breakout in gold above the bearish channel from last year’s highs is continuing to gather pace. Following a retest of the broken channel top and the 1763.88 level, price has since broken above the 1826.71 level. While above here, the focus is on a continued push higher towards the 1919.92 level next.
SILVER
The breakout in silver above the falling wedge pattern, which has framed the correction from last highs, has seen silver rising above the 25.1018 and 27.4502 levels. While above here, the focus is firmly on a continued rally towards the 29.9382 level next.
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Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.