Hawaii Six O - Gary Wagner
Solid Gains in Gold Move Current Pricing Above its Trading Range
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Today gold broke out and above the narrow and sideways trading range that has been so dominant over the last nine trading days. As of 5:00 PM EDT gold futures are currently trading up $17.80 (+1.18%), and fixed at $1524.00. Silver is also trading higher on the day however it is gold that is outperforming silver in terms of its percentage gain today. Currently silver futures are fixed at $18.04, after factoring in today’s net gain of $0.156 (+0.87%).
Today’s solid gains in the precious metals complex had moderate headwinds from a stronger U.S. dollar index which gained .25%, and is currently fixed at 98.095. Recent moves in both gold and silver have taken the gold silver ratio from 79.14 on September 4 to its current ratio of 84.439 today.
However, it was palladium futures which traded to an all-time record high today at $1638 before softening a bit prior to the end of trading this week and is currently at $1620.60, a new all-time record closing price retaining its position as the highest priced precious metal that trades on the futures exchange. Based upon a Fibonacci extension of the third wave rally we could see palladium go as high as $1714 before hitting a corrective period.
Gold, silver, platinum and palladium all gained with the fundamentals today solidly supportive of the safe-haven asset class. U.S. equities had a moderate decline, creating an aversion to the risk-on asset class. The trade talks between the United States and China hit a brick wall today with President Trump saying that he was looking for a “complete” trade deal with China rather than an interim deal.
As reported by CNBC, “President Donald Trump on Friday said he doesn’t think he needs to strike a trade deal with China before the 2020 presidential election. “No, I don’t think I need it before the election,” Trump told CNBC’s Eamon Javers during a news conference at the White House alongside Australian Prime Minister Scott Morrison.
Trump also said he didn’t want a “partial deal” with Beijing, moving away from his suggestion last week that he would consider an “interim deal.”
According to Reuters, “Chinese agriculture officials who were due to visit U.S. farm states next week have canceled their trip to Montana as the officials will return to China sooner than originally scheduled, the Montana Farm Bureau told Reuters on Friday. The cancellation came as U.S.-Chinese trade talks were held in Washington and U.S. President Donald Trump said he wanted a complete trade deal with the Asian nation, not just an agreement for China to buy more U.S. agricultural goods.”
These fundamental events with the addition of more sanctions against Iran certainly changed market sentiment for the precious metals and safe haven assets as this week concluded. It seems quite plausible that we will see both gold and silver continue to rise next week now that they have broken out of their sideways trading range.
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Wishing you as always, good trading,