Last Friday (November 17th), gold prices remained stable, with spot gold closing 0.03% lower at $1980.65 per ounce after reaching a two-week high earlier in the day. Last week, prices increased by about 2.2%.
Last Monday (November 13), before the release of the US consumer price index (CPI), the gold price (XAU/US dollar) rose slightly due to the weakness of the US dollar and the decline in the yield of US treasury bond bonds. As the yield of US treasury bond bonds declined, the US dollar weakened as a whole, and gold prices rose due to some buyers.
Although the Israeli-Palestinian conflict is still ongoing, political risks still weaken according to market reactions. However, the escalation of the conflict still exists and may be beneficial to gold. Meanwhile, gold traders are looking forward to receiving some clues from the Fed spokesperson.
Last Tuesday (November 14), due to the weak US inflation report, the yield of US treasury bond bonds plummeted, which put pressure on the US dollar, and gold prices rose. Spot gold rose 0.86% to 1963.00.
The US Consumer Price Index shows that the annual inflation rate has decreased from 3.7% in September to 3.2% in October, lower than the market expectation of 3.3%. The core inflation rate has also slowed from 4.1% to 4%, the lowest level since September 2021. This data weakens the expectation of the Federal Reserve raising interest rates before the end of the year and drives market expectations for the first rate cut since 2020.
Last Wednesday (November 15th), due to the slower than expected decline in US retail sales data for October, gold prices faced selling pressure. Spot gold retreated after hitting the weekly high of US $1975.22/ounce. The failure to hold above US $1970 was mainly due to the US dollar pullback and the rebound of US treasury bond bond yield. Spot gold closed 0.19% lower at $1959.25 per ounce.
In terms of US economic data, the Producer Price Index (PPI) fell by 0.5% in October, less than the expected growth of 0.1%. The annual growth rate has also decreased from 2.2% to 1.3%. In addition, the core PPI data was lower than expected. These data are consistent with the Consumer Price Index (CPI) data released last Tuesday, indicating that inflation is cooling down. Retail sales decreased by 0.1% in October, and a significant decline of 0.3% is expected.
The economic focus has strengthened the evidence that drove the US dollar lower last Tuesday, although the impact on Wednesday was different, which may be due to a pullback. At present, risk appetite still exists, US bonds are strong, and the US dollar is still fragile, all of which may support the further rise of gold price.
Last Thursday (November 16th), spot gold saw a significant increase and resumed its upward trend. Boosted by the weakness of the US dollar and the decline in the yield of treasury bond, the gold price broke through the resistance level of US $1975 and jumped to the highest level in more than a week. The price rose more than US $20, also driven by technical factors. The settlement price of spot gold rose 1.12% to close at $1981.11 per ounce.
The data released last Thursday showed a weakening labor market, coupled with recent inflation data, reinforced the view that the Federal Reserve is unlikely to raise interest rates further. These unfavorable US economic data exacerbated the decline of US treasury bond bonds. US treasury bond are usually regarded as the cost of holding non yielding metals, leading to soaring prices. The yield of US treasury bond bonds fell to a weekly low, the interest rate of two-year bonds fell to 4.83%, and the yield of five-year and 10-year bonds fell 4.43% and 4.45% respectively.
The latest Kitco News weekly gold survey for this week's outlook shows that retail investors remain overwhelmingly bullish in the coming week, while the same proportion of market analysts have shifted to a neutral assessment of gold's near term prospects.
Last week, 12 Wall Street analysts participated in the Kitco News gold survey. As in the previous week, three experts (25%) expect gold prices to rise in the coming week, but only one expert (8%) predicts a decline in gold prices. The vast majority (67%) hold a neutral attitude towards gold in the coming week.
At the same time, Kitco's online poll generated a total of 595 votes, and market participants' attitudes were more optimistic than the previous week's survey. 394 retail investors (66%) expect gold prices to rise in the next week. An additional 125 respondents (21%) expect prices to be lower, while 76 respondents (13%) are neutral about the near future prospects of precious metals.
This week will be a brief trading and economic data release week, as Thursday is the Thanksgiving holiday in the United States, which means most activities will be compressed to the first three days. Highlights include the release of the latest minutes of the Federal Open Market Committee meeting on Tuesday and existing home sales data for October, followed by the release of durable goods data for October, consumer confidence data for November from the University of Michigan, and weekly unemployment claims on Wednesday.
Technical analysis of gold: Last Friday morning, gold opened at the 1980 level and received support immediately after opening, unable to break through the 1980 level. Instead, it began to rise, and as a result, gold directly rose to the 1986 level. However, after this, gold fell into turbulence and could not further break through. During the Asian session, gold fluctuated between 1986 and 1982. In the European trading period, gold has further risen since 1982, strengthening the strength of bulls. Gold fluctuated and rose all the way, breaking the previous day's high of 1987 and further breaking the 1990 level. The rise of gold eventually stopped at the first line in 1993 and began to decline below 1990.
From the daily chart, it can be seen that the daily line has been fluctuating for three days between 1955 and 2000 in the residential area. After breaking a new high point on Friday in 1987, it began to step back and closed with a cross negative line. The daily line's high point kept refreshing, and the upward channel was intact. It is expected to continue to fluctuate and rise. From the moving average, MA5 and MA10 formed a golden cross. From the indicators, Brin took off flat, and gold was running on the Brin belt's upper track. From the indicators, KDJ continued to turn upwards, The MACD green kinetic energy column is gradually decreasing, and all forms and indicators are bullish at the same time. Therefore, the short-term decline is still mainly in the long run, but before the 1993 area above is broken through, we cannot blindly pursue the long run.
From a four hour perspective, gold fluctuated upwards. Although it did not form a unilateral upward trend, the overall high point moved upwards, and the low point continued to move upwards from 1950, 1975, and 1987. The longer the platform was consolidated during the upward trend, the better the sustainability and intensity of the upward wave. So for next week's operations, although gold is currently falling back to 1978, short positions have not yet further broken through 1975, and the future sharp decline trend still needs to pay attention to whether there are any unexpected events happening over the weekend. If the resistance level above can break through the 1993 line, it will once again test the 2000 mark, opening the door for further increase in gold prices. If it falls below 1970, it will test the 1955-50 line support.
Focusing on the first line of resistance from 1990 to 1993,
Pay attention to the frontline support from 1965 to 1963 below.
Analysis of crude oil news: Last week, due to data showing a gradual slowdown in the US economy, the US stock market was mixed, and bonds climbed, exacerbating speculation that the Federal Reserve will end its interest rate hike. The price of crude oil continues to decline, and both internal and external oil prices are under pressure. In the short term, without significant sudden bearish effects on the supply and demand side, oil prices continue to break through and plummet under the dual negative effects of increased supply and bleak demand prospects. Setting aside the disturbance caused by technical factors to oil prices, it is expected that the trend of oil prices in the next 4-6 weeks will mainly depend on the execution rate of OPEC+production reduction. If OPEC+(especially Saudi Arabia) fails to fulfill the promised reduction in production in early September, the perspective of oil price trading is likely to return to the macro level, and data needs to be referenced. If OPEC+(especially Saudi Arabia) fulfills the reduction in production between November and December, the perspective of oil price trading will still return to supply and demand, and the impact of the data is only added.
Last Friday, as of the morning close, the international crude oil futures settlement price fell significantly by over 4%, marking the largest single day drop since November. Yesterday's low volatility briefly rebounded, but the space was extremely limited. In the evening, crude oil suddenly experienced a sharp drop and retreat. Although it met our short order expectations, it fell below the strong support band of 75-74 expectations, and the low point dropped to around 72 before stopping, which was somewhat unexpected, Although the rebound in the back surged above 73, due to extreme selling sentiment in the market, the daily line ultimately closed with a large negative line. However, from the perspective of daily structure, the current crude oil technology is already in a downward trend, and it is difficult to see any hope of a reversal and recovery. 75-74 was directly shattered, and there is also panic in the short term, triggering a sell-off, which is also the main reason for the decline of crude oil. After all, the 75-74 area is a densely traded area in the early stage.
Technical analysis of crude oil: Last Friday, crude oil continued its weak trend after breaking the negative line, which was in line with expectations. After consolidation, the daily line took back the rebound space of the previous double positive line. With the continuous negative consolidation of the daily line, it accumulated momentum and formed a new low of 72.37 on Friday. The daily trend continues to weaken, and after breaking the low, the short-term trend will continue to follow a unilateral weak trend, further releasing the low level space. During the 4-hour downward trend of the step channel, the previous rebound of 79.70 was hindered by the high point of the structural step, and after breaking the low point, it further extended and expanded the downward space. One wave of consecutive yin retreats was relatively weak, and the intraday rebound continued to be bearish based on yesterday's high defense. Short term trading at low positions may be accompanied by a step by step correction of the move.
The upper short-term focus is on the 77.8-78.0 front line resistance, while the lower short-term focus is on the 74.3-74.5 front line support.
