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Gold Silver, still bullish despite volatility

Commentaries & Views

$1915 gold is starting to look like support. The yellow metal bounced from that level yesterday morning and did so in the wee hours again today.

Bulls are eyeing a weekly close above $1925. Silver found support at $24.90 this morning, a bullish sign should that level continue to hold, and a possible indicator that the catch-up trade in silver is ready to kick off. The battle for $1065 in platinum rages on with momentum favoring the bulls, as the recent run-up pattern of higher lows remains intact.

Last night President Biden assured the world that U.S. troops will not be setting foot in Ukraine; he also brought up the issue of inflation. The president announced a coordinated release of barrels of crude oil from the U.S. and international strategic reserves in an effort to put a damper on prices. The success of the initiative remains to be seen, as it has had only a short, temporary effect in the past.

Stocks futures are pointing to a green open, likely fueled by a combination of reassurance from the U.S. President and a stabilizing U.S. treasury market. Note that indices now trade back above the Jan 24 low and have been trading higher since the Russia/Ukraine conflict concretely broke out.

At this point, stock bulls may be factoring that the de-escalation of tension in Europe is probably the path of least resistance moving forward. De-escalation may also be the most politically expedient outcome, as oil prices begin to enter territory that puts significant pressure on the world economy, which has always led to recessions in the past.

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