Contributed Commentaries
CPM Trade Signal - November 10, 2022
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Time Stamp
Prices as of 11:19 a.m. EST 10 November 2022 $1,748.80 (Basis the December 2022 Comex contract).
Recommendation: Buy
Initial Target Price / Range: $1,760
Initial Timeframe: 10 November 2022 to 25 November 2022
Gold prices have been trending higher since late last week when they bottomed out at $1,631.10. As prices topped resistance levels, follow through buying began to help push prices higher. This week prices topped $1,700. Today prices continued to climb following the release of modestly weaker than expected inflation figures for the United States. Headline inflation and core inflation both were lower than expected by around 0.2%, suggesting that the Federal Reserve may not need to continue raising rates as aggressively as it has going forward. The idea that the Fed would slow its rate increases over the next four months already was the consensus in the broad financial market, and the CPI figures reinforced this opinion. The U.S. dollar weakened on this news, providing support to commodities prices, including gold.
It is not clear if inflation will continue to trend lower, but this is the expectation for now. The most recent consensus forecast published by the New York Fed with September data is that headline CPI may be around 5.4% a year from now. More will be known next month when inflation figures for November are released and the Federal Reserve meeting takes place.
In the interim gold prices are likely to continue to test resistance levels. Prices are technically strong now, with fundamentals also firm. This is in addition to the exogenous factors that remain supportive of gold prices, such as the politics that can surprise markets at any point.
CPM has one-month, three-month ranges and eight-quarter quarterly price projections with greater discussion of the factors behind CPM’s analyses provided in CPM’s monthly subscription service, the Precious Metals Advisory.
While short-term trade recommendations provide high risk – high reward opportunities for investors, it is difficult to capture the complex web of factors affecting precious metals prices and the nuanced CPM analyses of these factors that goes into our firm’s price projections. In addition to these short-term outlooks, CPM Group provides clients enhanced trade recommendations that include one and three month price projections, as part of our Retail Investor Program. Contact CPM at info@cpmgroup.com for details.
Notes:
Initial Target Prices and Timeframes are just that: Initial. If CPM does not issue a new Recommendation during or after that time it indicates that CPM maintains the posture in the most recent Trade Recommendation.
Position may be closed out once target price is reached, within the noted discretion or until CPM provides new trade recommendation. CPM may have reported to have closed out of prior trade recommendation at its discretion before publicly publishing new trade recommendation due to processing time.
Discretion should be allowed at +/- 0.20% of the price at the time each TR is issued from the target.
CPM’s preferred investment strategies use physical, futures, forwards, and options.
Disclaimer - Past performance is no indication or guarantee of anticipated future profits, and neither Kitco Metals Inc. nor CPM Group can accept any liability or responsibility for any loss suffered as a result of gold price fluctuations. Gold as a commodity is not a specified investment for the purpose of giving advice under the Financial Services and Markets Act 2000. Therefore this trade recommendation does not give rise to rights to claim compensation under the Financial Services Compensation Scheme. CPM Group is a registered CTA with the U.S. NFA and CFTC. At times the principals and associates of CPM Group may have positions in the precious metals, commodity, and equities markets. CPM Group also manages investment and industrial positions in markets for its clients.
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