With outside market forces of lower US rates and a weaker US dollar, both gold and silver started the Wednesday trade with a relatively strong bid.
In fact, as of this writing the dollar sat just above a downside breakout and a six-day low which could result in gold and silver adding to the early noted gains.
For a change, the silver market could take a leadership role with Fresnillo projecting 2024 silver production to be 7 million ounces below 2023. Unfortunately for the bull camp, Fresnillo also posted a 13% year-over-year increase in silver production for 2023...[MORE]
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Apparently, severe losses in Chinese equity markets has prompted Chinese officials to consider implementing a $278 billion rescue package.
Therefore, gold may see some limited flight to quality buying interest, but as mentioned many times over the last year, the gold and silver trade are not as sensitive to flight to quality events as in the past.
On the other hand, if the situation becomes dire and there is a chance of contagion that could pull in a noted measure of spec and fund longs...[MORE]
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While the US dollar is showing some vulnerability on its charts early today, treasury yields may have temporarily peaked leaving the primary outside market influences slightly supportive of gold.
However, we see no reason to take control away from the bear camp with the hedge funds reducing their long positioning last week, another week of ETF holding declines, an overbought net spec and fund positioning, a residual negative global commodity market environment, and perhaps most importantly from growing economic concerns in China.
With the last COT positioning report showing the net spec and fund long in gold near the highest levels since May 2022, falling trading volume and declining open interest on last week's recovery bounce, the bear camp retains control over the trend...[MORE]
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