Gold and silver correct from record highs set in overseas trading 5-Day Change: +$210.68 (+5.24%) YTD Range: $2,607.16 - $4,378.90 52-Week Range: $2,541.42 - $4,378.90 Weighted Alpha: +65.31 Gold set a new record high of $4,378.90 in Asian trading before coming under corrective pressure after President Trump acknowledged that "full-scale" tariffs on China are unsustainable. The modest easing of trade and geopolitical tensions appears to have prompted profit-taking. Despite the sharp pullback, the yellow metal still appears poised for its ninth straight higher weekly close.  However, today's outside day sets up a potential key reversal, suggesting scope for additional retracement of the recent gains. Short-term losses are still seen as corrective in nature. Moderation of the extreme overbought condition that had developed would be healthy for the underlying uptrend. Gold has been unable to sustain the initial probe below $4,200, keeping Wednesday's low at $4,141.06 at bay. A breach of this level would shift focus to the $4,100.00/$4,091.27 zone. I'd still like to see a test of the 20-day MA, which should rise to the $4,000 area next week. A period of consolidation, where the 20-day catches up to the market, would be just as good in my book. On the upside, first resistance at $4,300 stands in front of the more substantial $4,330.40/35.58 zone. Above the latter, the $4,378.90 high would be back in play. Fresh record highs would shift focus to $4,400 and $4,430.83. SILVER OVERNIGHT CHANGE THROUGH 6:00 AM CT: -$0.283 (-0.52%) 5-Day Change: +$1.786 (+3.57%) YTD Range: $28.565 - $54.465 52-Week Range: $28.565 - $54.465 Weighted Alpha: +75.65 Silver reached a new record high of $54.465 in Europe before succumbing to profit-taking pressures ahead of the weekend. While the white metal plunged nearly $4 intraday, it's still on track to notch a ninth straight higher weekly close.  Like gold, there is a potential key reversal on the daily chart. However, silver is already trading more than $1 off the intraday low. What a week it has been in silver. Arguably, a correction was overdue, but the supply and demand dynamics suggest that the underlying bull trend still has legs. Beyond the London short-squeeze, silver's unique properties make it indispensable for solar power, electronics, sophisticated weaponry, 5G technology, and AI infrastructure. As noted in Wednesday's commentary, if silver is approved as a critical mineral this year, the U.S. government would be obliged to secure domestic supply chains via enhanced permitting, subsidies, and strategic stockpiling. Additionally, the CEO of Wheaton Precious Metals told Bloomberg that he's heard talk that some central banks are considering adding silver to their balance sheets. This would further stoke demand in a relatively small market (much smaller than gold), which is already in its fifth year of a structural supply deficit. The implications are quite bullish indeed! My next major upside target is at $60.417 (127.2% retracement of the decline from $50.000 to 11.703). A close back above $52 would probably be seen as encouraging by the bull camp. Additional tiers of resistance are noted at $53.586, $54.465, $55.000, and 55.496. Today's intraday low at $50.630 now becomes important, along with $50.495 as protectors of this week's low at $50.083. A retreat below $50 would put the 20-day MA at $48.307 in play. Be prepared for further volatility. 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. |