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Time Stamp
Prices as of 10:15a.m. EDT Comex 21 July 2022 $1,703.10(Basis the August 2022 Comex Contract).
Recommendation: Sell
Initial Target Price / Range: $1,680
Initial Timeframe: 21 July 2022 to 29 July 2022
Gold prices slipped to $1,678, below CPM Group’s previous Sell recommendation price target of $1,680, earlier today. Gold prices have rebounded from those low levels as the U.S. dollar weakned in response to a 50 basis point increase in interest rates by the European Central Bank (ECB). This increase was double what most market participants expected. The ECB also announced its new Transmission Protection Instrument – a bond purchase program to shelter more indebted EU countries and prevent financial fragmentation within the Euro bloc. The Nord Stream pipeline supplying gas from Russia to Europe also was restarted today. All of these factors have been positive for the euro and consequently weighed on the U.S. dollar. The effects may be short-lived, however.
Gold prices are expected to rise first in response to the fresh news out of Europe and from being extremely oversold at this time. However, gold prices still are in a shorter term downtrend, and thus gold prices may well continue weaken over the next several weeks. Gold prices seem likely to fall back below $1,700, with initial support at $1,680. Seasonal weakness, lowered future inflation expectations, and tightening monetary policy around the world is expected to weigh on gold prices.
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.
