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Gold backs off from another new all-time high

OUTSIDE MARKET DEVELOPMENTS: Markets were somewhat relieved by Friday's announcement that smartphones, computers, and other electronics imported from China are excluded from reciprocal tariffs. President Trump subsequently clarified via TruthSocial, "There was no Tariff exception announced on Friday. These products are subject to the existing 20% Fentanyl Tariffs, and they are just moving to a different Tariff “bucket.”"

Additionally, China stoked trade war worries by announcing it would halt the export of rare earth minerals to the U.S. China controls about 90% of the global production of these critical elements. 

While uncertainty remains high, risk appetite was generally improved to begin this holiday-shortened week. Whether that optimism can be sustained remains to be seen.

National Economic Council Director Kevin Hassett said this morning that more than 10 countries have made "amazing" trade deal offers that are being considered. Hassett also believes there is no chance of a recession this year.

High-level discussions over the weekend between the U.S. and Ian about its nuclear program were described as  "constructive." With a second round of talks slated for April 19, geoplitical risks have been dialed back marginally.

Aside from FedSpeak, today's U.S. economic calendar is empty. Except for Asia, global markets will be closed on Good Friday. Europe and the UK will be closed on Easter Monday as well.


GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CST: -$23.63 (-0.73%)
5-Day Change: +$228.36 (+7.66%)
YTD Range: $2,607.16 - $3,243.89
52-Week Range: $2,281.97 - $3,243.89
Weighted Alpha: +39.72

Gold set a new all-time high of $3,243.89 in overseas trade before retreating into the range. Last week, the yellow metal notched a 6.6% gain, its biggest since the COVID crisis five years ago.



I believe today's setback is just profit taking, stemming from improved risk appetite, and the short-term overbought condition that developed into Friday's close. The trade will be looking for opportunities to buy on this setback.

Ongoing trade and geopolitical uncertainty, along with the absence of a strong alternative in the safe-haven space, should continue to drive demand. Softer yields and persistent dollar weakness provide additional underpinnings.

Global ETFs saw net inflows of 52.1 tonnes last week. It was the eleventh straight weekly inflow, and the third largest since July 2020.  North Americans were the biggest buyers, but Asian investors accounted for 39% of last week's inflows, enticed by the drop in price at the beginning of the week and a weaker dollar.

Net speculative long positions dropped 37.7k contracts to an 11-month low of 200.7k in the 11-April week according to the latest COT report. It was the second straight weekly decline in spec long positioning as leveraged traders were probably rattled by last week's price volatility.

CFTC Gold speculative net positions

Gold traded briefly below $3,200, but Friday's low at $3,174.99 does not appear to be in immediate jeopardy. Secondary support is marked by the old record high from 03-Apr at $3,264.72. 

The high from early U.S. trading at $3,226.20 now protects the record high from Asian trading at $3,243.89. Penetration of the latter would keep gold on track for a push to the next Fibonacci objective at $3,290.11.

The $3,300 level remains a valid target. Each new high also bolsters confidence in the longer-term target of $3,500.

UBS hiked its 12-month gold forecast to $3,500 on Friday, citing expectations for "additional demand from central banks, institutions and investors following current events.” It was the bank's second upward revision this year.

Silver continues to trade in the upper half of the broad $34.543/$28.565 range for the year that was established during the preceding three volatile weeks. Some optimism on the trade front, strength in gold, and a weak dollar are providing support.



While more than 61.8% of the decline from the late-March high has already been retraced, the 50- and 20-day moving averages are converging just above the overseas high and conspiring to limit the upside. Those MAs come in at $32.508 and $32.660 today.

The COT report for last week revealed a 10.8k decline in net speculative long positions from 57.3k to a 10-week low of 46.5k contracts. It was the second consecutive weekly decline.

CFTC Silver speculative net positions

Today's low from early U.S. trading at $31.895 fortifies the London low at $31.833. More important support is marked by the midpoint of the range and the 100-day MA at $31.554/$31.465 


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
312-549-9986 Direct/Text
[email protected]
www.zanermetals.com

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

Haven demand drives gold to record highs above $3,200, silver follows to regain $32

OUTSIDE MARKET DEVELOPMENTS: The trade war between China and the U.S. continues to escalate. Beijing raised retaliatory tariffs on all U.S. goods to 125%.

President Trump lifted tariffs on Chinese goods to 125% on Wednesday, but that's on top of 20% fentanyl-related levies already in place. The White House confirmed that tariffs on Chinese goods currently stand at 145%.

Trump paused reciprocal tariffs on other countries for 90 days to provide time for ongoing negotiations. "USTR has informed us that there are maybe 15 countries now that have made explicit offers that we're studying and considering and deciding whether they're good enough to present the president," said White House Economic Advisor Kevin Hassett.

"Everybody wants to come and make a deal, and we're working with a lot of different countries, and it's all going to work out very well," predicted President Trump. Some are sceptical that all these new trade deals can get done in three months, but I believe progress will beget a longer pause if necessary.

Nonetheless, uncertainty prevails, which will continue to roil markets. "In the 129-year history of the Dow Jones Industrial Average, the index has closed higher or lower by at least 1,000 points just 31 times. Four of those times happened in the past week," noted CNN.

Global uncertainty and concerns about the Trump administration's tactics have undermined the appeal of U.S. assets. While this week's Treasury auctions were fairly well received, the 10-year yield surged to eight-week highs above 4.5% amid evidence that foreign holders of U.S. debt are accelerating their retreat from Treasuries.

FX flows typically follow higher yields, but the dollar index has fallen to three-year lows. Haven interest in the foreign exchange market has shifted to the Swiss franc, yen, and to a lesser degree, the euro.

The franc has reached a 14-year high against the greenback, gaining nearly 8% since the beginning of April. The SNB is under increasing pressure to slow the franc's rise via a rate cut or direct intervention.

While U.S. inflation cooled in March, the needle hasn't moved much in terms of Fed policy expectations. Fed fund futures continue to price 75 bps in easing by year-end, with the first 25 bps cut likely to come in July.

PPI fell 0.4% in March, below expectations of +0.2%, versus a revised +0.1% in February (was unch); 2.7% y/y, down from 3.2% in February. Core -0.1% on expectations of +0.3%, versus +0.1% in February (was -0.1%); 3.3% y/y, versus 3.5% in February.


GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CST: +$36.83 (+1.16%)
5-Day Change: +$186.00 (+6.12%)
YTD Range: $2,607.16 - $3,231.83
52-Week Range: $2,281.97 - $3,231.83
Weighted Alpha: +43.06

Gold marched to new record highs above $3,200, boosted by persistent haven flows and a weaker dollar. With a weekly range of more than $275, I think we can say it's been one heck of a week!



My takeaway is that gold remains the haven asset of choice, and that gets amplified when Treasuries and the dollar fall out of favor. However, those initial deleveraging sell-offs in gold make for a wild ride.

With other countries less inclined to hold dollars and Treasuries as reserve assets, the appeal of gold is heightened. Global central banks have been on a buying spree for nearly two years, and that trend seems likely to accelerate in light of recent events.

The 127.2% retracement level of this week's corrective plunge at $3,219.91 has been exceeded, shifting focus to the next Fibonacci level at $3,290.11. Beyond the latter, $3,300 attracts. Recent price action also lends additional credence to the longer-term target at $3,500.

While the dominant uptrend has fully reasserted itself, I wouldn't be surprised to see some profit-taking ahead of the weekend. Initial support is marked by the early U.S. low at $3,211.77, which protects the low for the day at $3,174.99, and the old record high at $3,264.72. I'd call $3,200.00 a minor downside barrier as well.

Silver is trading back above $32, pulled higher by resurgent gold, the plunge in the dollar, and perhaps some optimism that deals will get worked out with most of our trading partners. The white metal is poised to close higher on the week after initially plunging to a seven-month low on Monday.



Silver is back above the 200- and 100-day moving averages, and nearly 61.8% of the two-week plunge has already been retraced. A breach of $32.259 Fibonacci level would bode well for tests of the 50- and 20-day MAs, which are going to converge around $32.50 early next week. Above the latter, the next tier of Fibonacci resistance is at $33.264.

I have always maintained that gold is the best option for wealth preservation. Silver's volatility over the past two weeks puts an exclamation point on that position! I believe investors will be gun-shy when it comes to silver for some time to come. Caution remains warranted for both the bull and the bear camps.

Given the magnitude of the gains since Monday's low, it seems likely that we'll see some profit taking ahead of today's close. The early U.S. low at $31.267 is the first level of significant intraday support. The low for the day at $31.039 seems well protected, but I guess you really never know with silver these days. 


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
312-549-9986 Direct/Text
[email protected]
www.zanermetals.com

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

Gold rebounds to approach $3,100, silver back above $31 on tariff pause

OUTSIDE MARKET DEVELOPMENTS: Stocks remain volatile, swinging from the red to solid gains after President Trump announced a 90-day tariff pause for non-retaliating countries on TruthSocial.

China remains squarely in Trump's sights with another retaliatory escalation in response to Beijing's latest retaliation.

Countries like Japan and South Korea are reportedly progressing toward new trade deals. However, the overall trade situation remains fluid and fraught with uncertainty.

Earlier, Trump announced that his next target for tariffs is the pharmaceutical industry to encourage them to relocate manufacturing to America. “They will leave other places because they have to sell—most of their product is sold here, and they’re going to be opening up their plants all over the place in our country,” Trump said during a speech on Tuesday.

[The rest of this segment was written before President Trump's most recent announcement]

Wall Street has noticed that the normal inverse relationship between stocks and Treasuries may be breaking down. When stocks sell off, investors typically rotate to bonds as a haven, pushing yields lower and stoking investment.

The market will be closely watching today's $39 bln 10-year auction with particular interest in gauging foreign demand. There is also a $22 bln 30-year auction tomorrow.

Mounting trade angst is likely inversely impacting foreign demand for our bonds. There have been reports of foreign selling over the past week, suggesting this week's auctions may not be well-received.

Tensions are arguably highest with China, the second-largest holder of U.S. Treasuries ($760.8 billion as of January). Japan and the UK are number one and two.

With interest rates unnaturally rising in tandem with growth risks, recession becomes increasingly likely. JPM CEO Jamie Dimon believes ongoing trade turmoil does indeed make recession a likely outcome.

“Take a deep breath, negotiate some trade deals. That’s the best thing they can do,” said Dimon on CNBC. “But I think it could get worse if we don’t make some progress here,” he added.

Treasury Secretary Besset dismissed the sell-off in bonds as "normal deleveraging," but the market is not convinced. Haven seekers also seem to be eschewing the dollar in favor of the yen and Swiss franc.

The dollar index fell to a new low for the week in earlier trade before rebounding into the range. A six-month low was set last week at 101.27.

That leaves few safe haven options amidst the past week of market turmoil. See the gold comment below...

MBA Mortgage Applications surged 20% in the 04-Apr week, versus a decline of 1.6% in the previous weeks. Both purchases and refis jumped as the 30-year mortgage rate slipped to 6.61% from 6.70%.

Wholesale Sales surged 2.4% in February, well above expectations of +0.8%, versus -0.9% in January (was -1.3%). Inventories rose 0.3% in line with expectations, versus a 0.8% rise in January.


GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CST: +$62.01 (+2.08%)
5-Day Change: -$48.57 (-1.55%)
YTD Range: $2,607.16 - $3,164.72
52-Week Range: $2,281.97 - $3,164.72
Weighted Alpha: +34.68

Gold surged to new highs for the week as the U.S. and China traded retaliatory strikes on the trade front. At one point, the yellow metal was up more than $100 and on the verge of regaining the $3,100 level.



The subsequently announced tariff pause spurred risk appetite and knocked gold off the intraday highs, but the market remains sharply higher on the day. With Treasuries and the dollar suddenly seen as less desirable havens, the appeal of the yellow metal has intensified.

The tariff pause allows for a deleveraging reprieve, removing a significant downside risk. However, Trump giveth and Trump taketh away. Who knows what this afternoon and tomorrow might bring?

With more than 61.8% of the recent decline now retraced, and gold back above the 20-day MA, a measure of confidence has been returned to the underlying uptrend. Under normal circumstances, I'd believe the corrective low is in place at $2,961.83. These are not normal times, so ongoing caution is advised.

Today's high at $3,092.59 now protects the next tier of Fibonacci resistance at $3,121.30 (78.6% retrace of the decline from $3,164.72 to $2,961.83). A retest of last week's record high at $3,164.72 is looking increasingly likely.

Watch the 20-day MA at $3,043.54 on a close basis. This level is bolstered by an intraday chart point at $3,040.05. A move back below $3,000 now would dishearten the bull camp.

Silver is setting new highs for the week, buoyed by risk-on sentiment stemming from the tariff pause. The white metal had already been tracking higher today, helped by strong safe-haven gains in gold.



Yesterday, I wrote that it was hard to look at the silver chart and not be bearish. Adding, "Sometimes that's the time to buy." With silver up more than 3% today, I wish I had!

I don't think this market is out of the woods yet, by any stretch. However, I am curious to see where we close relative to the 200-day moving average ($30.903) today. The 100-day MA is at $31.435, penetration of which would at least give the spec sellers some pause.

Silver swung from a five-month high of $34.543 to an eight-month low of $28.565 in just three weeks. A plunge of nearly $6 (17.3%) is enough to rattle the most ardent of silver bugs. I worry investors won't be back anytime soon.

First support is marked by a minor intraday chart level at $30.201. A retreat below $30 from here would keep focus squarely on the downside.

If you are a dealer, a refiner, or any business with physical precious metals in the vault, volatility like we've experienced recently can be very stressful. At Zaner Metals, we provide risk management solutions that help your business thrive even in the most uncertain of times. Call or email for details.


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
312-549-9986 Direct/Text
[email protected]
www.zanermetals.com

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.

4/8/2025

Gold upticks above $3,000 and silver tests above $30 are met with selling interest

OUTSIDE MARKET DEVELOPMENTS: China is refusing to kowtow to what it calls U.S. "blackmail" on trade, vowing to "fight to the end."  This comes in the wake of President Trump's threat to impose additional 50% tariffs on Chinese goods in retaliation for China raising its levies on U.S. goods.

Such rhetoric and actions are indicative of an intensifying trade war that is stoking worries about inflation and a global economic slowdown.

China also ramped up export controls on rare earths, threatening the technology supply chain. China accounts for roughly 60% of global rare earths production, essential components in data center storage systems, networking equipment, and semiconductors.

The EU Commission has proposed 25% retaliatory tariffs on some U.S. goods. Meanwhile, European Commission President Ursula von der Leyen has proposed a "zero-for-zero" tariff deal for industrial goods. That there are ongoing negotiations amid the retaliatory threats is somewhat encouraging.

Trump clearly telegraphed his intentions to deploy tariffs as a means to reduce the trade deficit and to be used as a cudgel in advancing a number of his administration's priorities. Yet markets seemed to have been caught completely off guard.

Uncertainty and panic prevailed over the previous three sessions. While U.S. shares are recovering today, investor confidence has been shattered, so this may just be the eye of the hurricane.

Fed funds futures continue to price in at least three 25-bps rate cuts this year. The first is likely to come in June or July, but the Fed is in a bit of a bind as tariffs have boosted both price and growth risks.

NFIB Small Business Optimism Index fell 3.3 points to a five-month low of 97.4 in March, below expectations of 101.3, versus 100.7 in February. "The implementation of new policy priorities has heightened the level of uncertainty among small business owners over the past few months," said NFIB chief economist Bill Dunkelberg. "Small business owners have scaled back expectations of sales growth as they better understand how these rearrangements might impact them," he added.


GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CST: +$25.38 (+0.85%)
5-Day Change: -$104.94 (-3.37%)
YTD Range: $2,607.16 - $3,3,164.72
52-Week Range: $2,281.97 - $3,164.72
Weighted Alpha: +30.21

Gold was unable to sustain earlier tests above $3,000, and a more defensive intraday tone has emerged. While deleveraging pressure ebbed with stocks rebound, risk appetite is likely to remain subdued amid ongoing uncertainty. The market is worried there are more shoes to drop.



A rebound above the halfway back point of the decline from last week's record high is needed to return confidence to the underlying uptrend. That retracement level comes in at $3,063.27. Intervening barriers are noted at $3,017.52 (today's earlier high), $3,042.33 (Monday's U.S. high),  and $3,049.78 (Monday's London high).

The greenback remains generally weak, with the dollar index having fallen to a six-month low last week. Ongoing concerns about a recession and the attendant rise in rate cut expectations should limit the upside in the dollar and help underpin gold.

On the downside, today's Asian low at $2,979.73 protects yesterday's four-week low at $2,961.83. Below the latter, watch the 50-day moving average at $2,947.66 and the $2,926.55 Fibonacci level (38.2% retracement of the rally from $2,541.25 to $3,164.72).

Silver is consolidating within yesterday's broad range, but the downside for the industrial metal remains vulnerable in the face of mounting fears of a full-blown trade war, demand destruction, and recession. While the white metal is still higher on the week, that condition is tenuous at best.


Tests back above $30 have been lackluster thus far, suggesting the rout may not be over. The plunge to seven-month lows below $28.783 on Monday and negation of all the important moving averages since Thursday are pretty bearish technical harbingers.

The inability of gold to sustain gains above $3,000 further emboldens the bear camp. Fresh intraday lows shift attention to the halfway back point of yesterday's rebound at $29.653. A breach of this level would suggest further tests below $29 are in the offing. Friday's low at $29.341 provides a minor intervening barrier.

Today's earlier high at $30.486 now protects yesterday's high at $30.74. Above that, the 100-day MA at $31.439 must be cleared (ideally on a close basis) to suggest potential for a rebound above $32.00.

It's hard to look at that chart and not be bearish. Sometimes that's the time to buy. While I'm inclined to be cautious in light of the recent volatility, I give the edge to the bear camp. 


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
312-549-9986 Direct/Text
[email protected]
www.zanermetals.com

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.