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Time Stamp
Prices as of 9:33 a.m. EDT Comex 13 July 2022 $1,717.90 (Basis the August 2022 Comex Contract).
Recommendation: Sell
Initial Target Price / Range: $1,695
Initial Timeframe: 13 July 2022 to 22 July 2022
U.S. inflation figures, both headline and core, came in stronger than markets expected. This resulted in a sharp decline in gold prices. While in theory gold prices should benefit from higher inflation numbers, the reality is that these higher inflation figures suggest that the Fed is likely to become even more aggressive in rasing rates to quell strong inflation. This is resulting in a stronger U.S. dollar versus other major currencies as well as placing a lid on future inflation expectations. It would not be surprising to see markets starting to price in a 100 basis points increase at the July meeting. While this seems a little excessive, it is common to see markets overeact to news that did not meet its expectations. All of these factors coupled with seasonal weakness and technical weakness on the gold chart suggests that prices could see near term declines. The initial price target for gold is $1,695, with a further decline to $1,680 possible.
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 is maintain the posture in the most recent Trade Recommendation.
Discretion should be allowed at +/- 0.20% of the price at the time each TR is issued from the target. Recommendations are valid until the target date or a new Trade Recommendation or message is issued by CPM.
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.
