Blog posts of '2025' 'December'

Gold pulled higher by surging silver, weaker dollar

OUTSIDE MARKET DEVELOPMENTS: U.S. consumers shrugged off inflation concerns and hunted early holiday deals, leading to the strongest Black Friday sales in history. Total sales were estimated $31.7 bln, a 4.1% increase over last year. Online spending alone hit a record $10.8 bln, up 9.8% year-over-year, according to Adobe Analytics.

Markets continue to eye the next week's FOMC meeting, and bets for a third consecutive rate cut have surged in recent weeks. The dovish pivot was driven by weaker – and perhaps dubious –incoming data and FedSpeak that suggested further easing was warranted. This offset last month's concerns about inflation and labor resilience. Fed funds futures currently put the probability of a 25 bp rate cut at 87.6%. 

Fed Chairman Powell will participate in a panel discussion this evening at Stanford, where he may comment on the economic outlook and monetary policy. Technically, Powell's remarks would fall within the Fed's pre-FOMC meeting 10-day "quiet period." If he does comment, I suspect he will remain neutral, perhaps with a slight dovish tilt.

The BLS will not be reporting the November jobs data this week as the repercussions from the government shutdown continue to reverberate. October data were withheld entirely and will be rolled into November in a delayed release slated for 16-Dec. That will leave the market to focus on claims data, the ADP survey, and Challenger Layoffs this week.

S&P Global Manufacturing PMI was revised up to 52.2 in November, versus a 51.9 preliminary read and 52.5 in October.

Manufacturing ISM slipped to a four-month low of 48.2 in November, below expectations of 48.6, versus 48.7 in October. The employment gauge retreated to 44, below expectations of 47, versus 46 in October.


GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CT: +$27.47 (+0.65%)
5-Day Change: +$96.13 (+2.33%)
YTD Range: $2,607.16 - $4,381.21
52-Week Range: $2,585.51 - $4,381.21
Weighted Alpha: +62.15

Gold extended to six-week highs on the first trading day of September, building on the nearly 1.5% monthly gain notched in November. The yellow metal is being buoyed by record highs in silver, expectations for further Fed easing, and a weaker dollar.



The breach of the 13-Nov high at $4,244.81 clears the way for a challenge of the $4,275.46 Fibonacci level. Above that, gold's all-time high at $4,381.21 would be back in play.

With silver charging higher into record territory, I do expect gold to follow suit. Beyond $4,381.21, focus would be $4,515.53 based on a Fibonacci projection, but such a move would also return considerable credence to the long-standing $5,000 objective.

The $4,207.09/$4,200.00 zone marks initial support. Friday's low at $4,153.68 is the more important short-term level to watch.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CT: +$0.762 (+1.34%)
5-Day Change: +$6.940 (+13.51%)
YTD Range: $28.565 - $58.833
52-Week Range: $28.565 - $58.833
Weighted Alpha: +107.36

Silver has extended to new record highs for a second straight session, driven by expectations that the Fed will cut rates next week, a weaker dollar, and diminished worries about the AI sector. Silver posted its seventh straight monthly gain in November and is off to a great start in December.



The white metal has gained more than 10% in just the last two sessions alone! Scope is seen for a short-term test of $60, which corresponds closely with a Fibonacci extension target at $59.966. Beyond that, there's a very long-standing Fibonacci objective at $60.417 (127.2% retracement of the entire move from the 2011 high at $50 to the 2020 low at $11.703).

Yes, the market is overbought, and corrections are likely to be violent, but buying into dips remains favored amid broadly supportive fundamentals. Hang onto your hats!

First support is marked by previous intraday highs $57.582/812. The $57 zone provides an additional intervening barrier ahead of today's Asian low at $56.232. 


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

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